Ever since the Affordable Care Act went into effect in 2010, Americans been required to have some sort of health care coverage, whether it’s bought on the insurance marketplace or provided by an employer.
But what happens when you have health insurance but you still can’t afford healthcare? That’s the conundrum facing 31 million Americans, according to a survey by The Commonwealth Fund. Commonwealth refers to them as "underinsured" – still technically insured, but still having trouble affording basic healthcare.
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One reason they’re underinsured is that their plans have high deductibles. The deductible is what you need to pay out-of-pocket before your health insurance kicks in. If you have a low income and high deductibles, it can be almost impossible to pay any out-of-pocket costs.
High deductibles can be hard for people of any income to deal with, but for lower income individuals and families, they can be nearly impossible, especially since they have very few other options. While there are many plans available with low deductibles, they usually carry higher monthly premiums, which can also be unaffordable.
If high deductibles are causing you to think twice about getting the healthcare you need, consider the following:
Make sure you’re getting your health insurance subsidy. If you’re a low-income earner, there’s a good chance that you qualify for a subsidy on the health insurance marketplace. A subsidy may help you afford a more expensive plan with lower deductibles.
Open a health savings account (HSA) or flexible spending account. The money that you put into a health savings account is tax-advantages, meaning that you don’t have to pay income tax on it (provided you use it to pay for health-related expenses). Either you or your employer can open an account for you. Read more about the differences between HSAs and FSAs.
See if you can get an exemption. The healthcare mandate requires that everybody have health insurance, unless you qualify for an exemption. Depending on your income and the size of your family, you may qualify for one.
Do research on available plans to see if there’s one that fits your needs and lifestyle better. While health insurance plans sold through the marketplace are required to offer the same basic benefits, they differ in many small ways. These small differences can make it difficult to research and decide which plan is best for you. One of those differences is the amount of co-pay you’re responsible for. Co-pay is the fixed amount you need to pay per doctor’s visit. You may be able to find a plan with lower deductibles but a higher co-pay, which, if you don’t visit the doctor very frequently, may be easier to budget for. If you don’t have any expensive prescriptions, you may also be able to find a plan with a stingier drug formulary (the gigantic list of every drug that they cover). By limiting their drug formulary, companies may be able to offer lower deductibles and co-pays for an affordable monthly premium.
Consider your options beyond health insurance coverage.
Even if you can’t get a health savings account or flexible savings account, you can open up a dedicated savings account to your health emergency fund. Contribute as much as you can afford every month – even as little as $5 or $10 will add up over time – and only use the money for healthcare expenses.
There are also urgent care clinics and telemedicine services that charge much lower fees than an emergency room would.
Image: Alex Proimos