It Pays to Shop Around

(3 votes, average: 5 out of 5)

Health insurance is a must. Here’s how to get the best deal on the right plan for you.

Medical expenses can add up quickly. In fact, health-related costs are a leading cause of bankruptcy in America today. That makes adequate health insurance a must. But health insurance can be a tricky thing for entrepreneurs. Without the benefit of an employer-sponsored plan, self-employed individuals are left to fend for their own health insurance needs. That dilemma alone is often a major obstacle for people who want to take the plunge into business ownership. On the other side of the equation are small-business owners searching for affordable benefits so they can attract and retain quality people.

With premiums ranging from about $150 to more than $650 a month or more and thousands of options, how do you find the best plan for you? Wendy Nice Barnes of eHealthInsurance.com offers some suggestions for finding the right plan and getting the best rates.

1. Pay only for what you need. “Shop around for the coverage you need,” Barnes says. “Evaluate your needs and your health. Don’t overpay, and don’t pay for things you don’t really need.” One example she offers is maternity coverage. If you know you’re not going to be adding a new family member any time soon, you may not want to pay extra for it. She also says it’s important to be honest about your health when applying for insurance. Trying to hide an existing condition can end up costing you more in the long run.
2. Keep costs down—and save. If you and your family members are in good health, Barnes suggests considering a high-deductible plan that offers lower monthly payments. The money you save month to month can be set aside in a health savings account (HSA). “An HSA allows you to put pretax dollars aside to pay for qualifying medical expenses,” she explains. “HSAs are different than flex-spending accounts offered by some employers. The money you put in an HSA goes with you wherever you go. Even if you leave an employer, it’s still your money.”
3. Get healthy. “Wellness is so important,” Barnes says. Because it helps keep their costs down, many insurance carriers offer discounts on gym memberships, smoking cessation programs as well as other resources, such as healthy recipes. Better health lowers your risks for many types of diseases, which may lower your health premium.
4. Do your homework. There are literally thousands of plans available from a variety of providers. By understanding your needs, you can narrow down your choices by doing online searches. And, if you don’t understand something, call and ask for clarification. You can call providers directly or take advantage of a broker service. Barnes says the company’s customer-service representatives can explain the differences between different plans and carriers, and they “have no interest in which carrier you select, but they can help you get a good sense for what makes the best sense for you and your company.”

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