Generating health and fitness resolutions at the beginning of a new year will not only save consumers money long-term but can boost the utilization of their medical coverage.
As some consumers are still researching their options for health insurance coverage before the nationwide open enrollment period ends on January 31, following some of these tips can net them decrease their monthly expenditures.
Save Money On Your Premiums
Start by quitting smoking, because your insurance premiums will decline immediately and the savings produced could be directed to other goals such as opening a health savings account where the funds accumulate tax free. In many states, health insurance companies are allowed to charge smokers more for their health coverage, said Nate Purpura, vice president of consumer affairs at eHealth.com, an online health insurance exchange based in Mountain View, Calif. In 2015, people who smoked paid an average $311 each month for their premium while non-smokers only shelled out $272, a $39 difference, according to eHealth data on consumers who did not utilize government subsidies.
“If you can beat smoking this year you may qualify for lower premiums next year,” he said.When you wind up spraining an ankle or injured from a car accident, the bills from unexpected doctor’s visits can add up quickly. Saving money ahead of time in a health savings account, which are commonly referred to as HSAs, can help you defray some of the costs and receive a discount. The contributions are not subject to federal income taxes and can be invested like an IRA. The advantage of an HSA is that any unused funds roll over each year and any remaining money can be used for retirement after the age of 65.
People who buy coverage on the public health insurance exchanges are especially good candidates, since most of the plans, including silver and bronze plans under Obamacare, are high deductible plans. A high deductible plan is defined as at least $1,300 for an individual and at least $2,600 for a family in 2016, according to the IRS.
While only 8% of Americans have am HSA account, 50% said they are somewhat or very likely to use an HSA to lower their taxes, according to a 2014 insuranceQuotes.com report.
Popular expenses that HSAs can be used for include prescription medications, doctor visits, dentist visits and eyeglasses. They can also pay for continuing coverage such as COBRA and long-term care insurance.