With increasing budget restraints, I have been struggling with health insurance premiums just like many others in the current economic situation. However, being in the business, I am considering some options to lower my rates while making sure I still have the best coverage when I need it.

Although it is more difficult, it is still possible to find affordable health insurance, you just have to know what to look for! As you probably know, your rates for individual health insurance will depend upon many factors. We need to examine these to determine what we can control.

Health Insurance Rates Are Set By:

• Your Zip Code. Yes, where you live will affect your premiums. Insurers look at the cost of medical services in your city, town, or rural area, and then set base rates accordingly.
• Your Age. Many insurers will group people by age, or by age band. For instance, the base rates for a 30-34 year old will be lower than those for a 50-54 yea old. In the US, we middle aged people, between 50 and 64 (Medicare Age), can really struggle with health insurance premiums.
• Your Health Habits. Overweight people, generally have higher premiums than others, the same goes for smokers compared to non-smokers. These factors greatly increase the chances of an expensive doctor’s bill down the road and thus raises the insurance company’s risk of insuring you.
• Health Conditions. Even controlled health problems, like high blood pressure, may cause insurers to increase rates over  people who have never been diagnosed with those health conditions.
• Type of Plan. If you buy a PPO, where the insurer can encourage you to use their cost-saving network, your rates may be lower than if you buy a policy where you can get their best coverage with any medical provider.
• Deductible and Copays. You know that, given the same plan, a $500 yearly deductible major medical plan will cost a lot more than a $2,500 yearly deductible policy! Likewise, a plan with a $10 doctor’s office visit copay will cost more than a plan with a $40 copay, or of course, a plan that does not offer a copay.
• Yearly Maximums. Be careful of this, but some policies set a yearly maximum on some, or all, medical services that is fairly low. For instance, outpatient services may be set at $10,000 a year. I would caution against using this tactic to lower premiums though. It may be fine if you only need to use your insurance to cover a minor ER visit, but awful if a family member needs outpatient chemotherapy for cancer! And that’s why you really buy health insurance, for large expenses, isn’t it?

What Can You Do To Lower Health Insurance Premiums?

Consider an H.S.A Major Medical Plan.

Health Savings Account plans have many benefits, and they work out well for some people. You buy a higher deductible major medical plan, which should be cheaper. The plan works with a tax advantaged savings account that can be used to pay for many medical services that are not covered, or that cost less than the higher deductible amount.

These plans tend to work well for people who are disciplined savers, and who appreciate the ability to deduct their contributions to the savings plan. However, people who cannot make a consistent contribution to to the savings plan, probably won’t be satisfied with them.

Advantages of an H.S.A

• Higher deductibles usually mean easier underwriting and lower premium.
• Tax advantaged savings accounts can cover deductibles and pay for non major medical services like dental and vision.
• Savings balances roll over if they are not used every year.
• Some savings accounts pay competitive interest rates on the balance.
• The savings account balance can be withdrawn at retirement (Medicare Age).
• Even if the covered person has to pay more towards the deductible, they should still get the benefit of some policy’s negotiated prices. This is an advantage over not having coverage at all.

Disadvantages of an H.S.A

If no money gets contributed to the savings account, a covered person would have a higher deductible to pay before the insurance company will cover medical services! In these cases, a traditional PPO or HMO may be a better option.

What if a Health Savings Account Medical Plan Won’t Work Out?

If you don’t think this type of plan will be a good option for your family, you may consider a couple of options for lowering your traditional health insurance premiums.

• Can you do without a doctor’s office copay? This may sound like heresy, but those copays can add 25% to your premiums and may not save you that much money. If the negotiated fee for a network doctor is only $100, and you do not see a doctor that often, you might consider dropping this benefit.
• Can you raise your yearly deductible? The premium difference between a $500 deductible and a $2,000 deductible should save you hundreds of dollars every year. Of course, it would be a good idea to set aside some of your savings in case you do need to pay a deductible.

Shop Around For Affordable Health Insurance

Insurance companies strive to remain competitive in the marketplace, and they introduce new plans all of the time. You may be able to find a more affordable major medical policy from another insurer.  This can be done by talking with local agencies, or more simply online, and then comparing coverage with cost to make an educated decision.

If you are shopping around for a new policy’, do not cancel your old policy, though, until you are sure that your new plan has accepted you, and you have a policy in your hand!

This guest post was written by one of the founders of 247QuoteUs.com , Barbara Waltz. 247QuoteUs is a resource blog and insurance quote comparison guide.

Photo by: Lisa Brewster

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The end of the year is coming up soon, and if you have a balance remaining in your Flexible Spending Account, you need to spend it by December 31st or you’ll loose the remaining balance. Here are a just a few ways to spend that money!

Get a Physical

Most health insurance plans pay for one yearly physical but it never hurts to get more than one especially if your other one was early in the year. Use your Flexible Spending Account balance to pay for that extra physical.

Eye Glasses

I don’t have a left over balance this year, but in prior years I used my balance to either get a new set of lenses or a new pair of glasses. My vision plan pays for one pair of glasses per year, but I’ve always found it beneficial to have a spare pair or two around. I also wear prescription sunglasses which aren’t covered by my vision plan. I’ve used my Flexible Spending Account balance to purchase these too. If you wear classes or contacts, use that remaining balance to purchase new one’s or some spares!

Stock Up On Over The Counter Medication

I’m surprised by the number of people who don’t know this, but your Flexible Spending Account can be used to pay for over the counter medicine. If you use particular over the counter medicines, use your balance to stock up on those medicines. Medicines that are handy to have around include: Advil, Tylenol, Pepcid, Mylanta, Cortaid, Neosporin, and Benadryl. I would encourage you to look for generic products as well so you get more for your money.

Make sure you check your plan to be sure what is covered. Drugstore.com offers a list of products that are FSA eligible. For example, vitamins aren’t covered unless prescribed by a doctor. Also, be careful to not stock up on so much that you won’t use it all before it expires.

Family Planning

The cold winter months are here and couples will be snuggling up next to their warm fires. You can use that Flexible Spending Account money to purchase birth control pills, condoms, and spermicides. If you aren’t wanting to get pregnant this winter, go ahead and stock up.

How do you spend that remaining balance? Add your spending strategies in the comments below!

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Clarian Health Partners Inc. was among the first companies to take advantage of these new rules. I first read about Clarian’s changes in an article published by MoneyNing. Since then further details have been announced and along with them a tremendous amount of controversy and discussion on the web.

Effective in 2009, Clarian will begin charging employees more for their health care coverage if they meet any of the following conditions: BMI (Body Mass Index) exceeds 30, Cholesterol levels are too high, Blood Pressure levels are too high,Glucose levels are too high, Smoking.

The price for not meeting these standards? $10 per paycheck if their BMI is too high, and $5 per paycheck for the others. Previously, Clarian had a program similar to many other companies that rewarded employees for staying in shape. But no more. The message is now stay in shape or pay the the price. Of the company’s 13,000 employees, about 8,000 are enrolled in the company’s health plan. The company estimates that as many as 34% of its employees will meet the definition of being obese, while it expects lower levels for other health measures. About 26% are tobacco users.

Clarian president and CEO Daniel Evans was quoted saying “For several years, we’ve had a reward program, where if you cease smoking and do a self-assessment, you receive a reduction in your [health care] premiums, [But] our health care costs were going up and our employees were not taking full advantage of the programs we had in place.”

Most would argue a carrot is more effective than a stick, and thus this bold move by Clarian is causing a great deal or stir amongst employees, companies, and worker support groups. Many argue that policies like this both invade employee privacy and confidentiality. Even with a controversy, a number of companies are changing to similar “stick” policies.

On one side, I can see the companies perspective on this around reducing costs and having a healthier workforce. On the other hand, I can fully understand the privacy issues and really question a companies right to tell an employee how to live their life.

I believe Clarian and similar companies are taking the right approach. Companies like Clarian have a responsibility to their shareholders, customers, and employees to keep costs down and profits up. They also want healthy employees who will be at work and have minimal health issues.

What are your thoughts on this issue? Would you work for a company that had a similar policy? If you were employed, would you continue to work there?

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With statistics like this, it may surprise you that 18 million people ages 18-34 don’t have health insurance. Why so high? Well, people in this age category are finishing school, or between jobs, or new to their jobs and don’t yet quality for heath benefits, or work for small companies that don’t offer health benefits. These people could purchase their own insurance, but it can be expensive especially for someone just graduating or in a new job.

The question many ask is: How can you afford not to get health insurance?? Making the choice to not have life insurance is a serious gamble. By choosing to not pay that $200 or so per month for health insurance, you are betting that you won’t be faced with $20,000 or $30,000 hospital bills if you have to end up in the hospital for a few days.

Considering getting insurance? Here’s a few tips and some info that might help:

Who says you can’t afford it?

A quick visit to Blue Cross/Blue shield showed sample premiums of $77 – $185 monthly for a healthy 25-year old man. The policy included a $1,000 deductible and prescription drug benefits. A healthy 25-year old female, $112-$275.

A few years back getting affordable individual health insurance was hard, but times have changed. Individual health insurance is in higher demand, and more companies are offering individual insurance which is increasing competition and lowering rates.

Even if you currently have employer offered benefits, I’d recommend you shop around as you may be able to find a better deal. This is particularly true for smaller companies that can’t get as good of deals as the large corporations.

COBRA – What they don’t like to tell you

COBRA allows people who have corporate health insurance to purchase coverage for a limited time after they quit their job or are layed off.

Great right? Well, there’s a catch…COBRA is expensive. You will pay the whole premium, both what you and your company paid together before. This can be a serious increase in cost for you depending on how much your company paid for.

Here’s what they don’t like to tell you though. Most people think they have to sign-up for CORBA immediately after leaving their company. Well, you don’t have to. You have 60-days to elect COBRA coverage and then another 45-days following the 60 days to actually buy it. That basically gives you 105 days without having to pay for any insurance. If you are fortunate enough to not get sick or not need to see a doctor, you won’t have to pay anything.

Here is what you need to do: Sign up for CORBA 60 days after leaving your job. If you need to use your health insurance in the next 45 days you pay for coverage. Don’t worry, claims are retroactive to the 1st day you were not longer covered at work, typically the day after you leave.

Like everything else, yes you can buy it online

Like purchasing anything else, you can use the major search engines to find online health insurance companies and deals. A site called eHealthInsurance though will make your job easier. The online company is similar to Expedia.com or Travelocity.com for health insurance. It currently represents over 166 carriers and has thousands of different plans.

Is it safe to purchase from no-name carriers?

Shopping online you can find some really good insurance deals. The problem is, may of the lower cost rates are most likely from carriers you’ve never heard of. These carriers can frequently be 1/2 the cost of the major name carriers. Now, if you’re like me you asking: What’s the catch? You need to be cautious, but it doesn’t mean you shouldn’t buy it. You just need to look into the details and do your research.

The first thing you should do if you are hesitant about a carrier is call your state’s department of insurance to make sure they are licensed in your state and that there aren’t any problems.

As with any business, call the Better Business Bureau look at their company report. You can also look up their A.M. Best rating. Insurance experts say they should have a grade of A- or better before considering them.

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James 1:12 – “Blessed is the man who perseveres under trial, because when he has stood the test, he will receive the crown of life that God has promised to those who love him.”

Update: 10/9/2007 – This post is dedicated to “Rich”.  “Rich” passed away on September 26th.  He was surrounded by his family when he took his last breath.  He is dearly missed here at work, and my only wish is I had gotten to know him better.

This is article is longer than usual, but I strongly encourage you to spend the time to read it. I am hoping it will change your life, and change the way you look at your finances and the risks you need to address in your life.

Rich* walked into my cubicle at work one morning this past February. “Do you have a minute?” Rich and I had been working on a project together and I figured he needed to discuss something concerning the project with me. I couldn’t have been further from the truth. We sat down in a meeting room, and Rich began “It would seem we have more in common than I thought, we both have lots of children, we both have a son with diabetes, we both enjoy football, and now we both have a brain tumor.” Before you get alarmed, mine is a rare but non-cancerous tumor. It can be dangerous, even life threatening, but mine is controlled with medication and is under control. I wish I could say the same for Rich…

Rich proceeded to tell me that he had been diagnosed with a malignant brain tumor at the base of his cerebral cortex (the area of the brain that connects your spinal cord to the brain). He was already experiencing symptoms: loss of vision, dizziness, and he said in order to reach for something, he had to intentionally reach about 4 inches to the left of the the object to grab it. I of course was shocked and completely at a loss for words. See, Rich had recently married. Him and his new wife had a child no more than a year ago. Yes, their little boy came a little late in their lives, but was a welcome blessing regardless. The previous day, Rich and his wife had met with their financial adviser, and where informed they had met and exceeded their retirement goals and that Rich could retire whenever he wanted. He is in his mid-fifties.

Within days, Rich was unable to work, and quickly began both chemotherapy and radiation to treat the tumor. All was expected to go well, and his family and doctors had high hopes that he would return to work soon. They had caught the tumor early, and the doctors were hopeful it could be treated and removed.

Fast forward to yesterday. We visited Rich in the hospital. He was admitted last week due to a stroke along his right side. Due to the tumor, he has completely lost function of his left side. He could barely talk due to the loss of muscle control with the tumor, and to be honest didn’t look well at all. To me, he looked like a completely different man. It was so hard to see this vibrant, funny, very strong man laying in a bed almost unable to move. After seeing him, I don’t think I will ever look at life the same way.

We of course are hopeful that he will overcome this. He is strong, stronger than I think I would be, but the cancer and associated treatments are really taking their toll on him. I am not sure he will ever be the same, even if the tumor is gone.

Craig

My friend Craig* had it all, a great family, a wonderful group of friends that him and his wife met with at least once a month. He had a great job that paid well above the the average salary. Life was good, and it seemed nothing could take that away…

The police showed up on Craig’s doorstep one evening. One of Craig’s “friends” had accused him of horrible crime against one of their children. This of course was so far from the truth it wasn’t even all together fathomable. Regardless, Craig was charged and arrested anyway. Life changed dramatically for Craig. He was suspended from his job without pay, and was removed from his home by child protective services (CPS). To this day, almost one year later he is still not home. He was able to return to work, but pending the outcome of his case He was out of work for more than 3 months with no salary.

Now, before you jump to conclusions about Craig, we were there, we know the situation and know beyond a doubt that there is no way he could or would have done what he was accused of; however due to the nature of the alleged crime, and to the public visibility and view on such crimes, the DAs office and CPS have gone after him with a vengeance. It could not have happened to a nicer family.

Where am I going with all of this you ask? My point is, these are just too many situations like this that I have run into during my 37 years in this world. Terrible, unexpected things happen to people all the time. Not just “bad” people, but good people as well. Life throws the best and worst of us unexpected curve balls that can completely change our lives, our priorities, our views, and test our faith beyond all we thought possible.

Even myself and my family have had to deal with a major life crisis that has, to be very frank, “rocked our world”. I once heard a pastor say “For a Christian, life on earth is our Hell.” Having recently gone through our situation, and seeing the two situations above first hand, this message from a long time ago has taken on a new meaning.

Be Prepared

Regardless of who you are, how well off you think you may be, bad things can happen. They may happen while you are reading this article, on your way to work or church, or maybe even while you are throwing the football in the back yard with your children.

These are things none of us want to think about, but are things that happen to people just like you and I every single day. I doubt the people killed in the recent Mississippi river bridge collapse thought they wouldn’t make it to their destination. I doubt the people in the twin towers on September 11th thought they wouldn’t make it home that night, or make it the gym that afternoon.

These are all things we like to put in the back of our mind, even though we see the tragedy occur to others everyday. We like to think those things can never happen to us. Well, the reality is the people we are watching or hearing about thought this very same thing the minute before tragedy struck.

My Best Friends Father

When I was in high-school, my best friend’s father was hit with a sudden and major heart attack while, ironically enough, conducting a funeral. He died before he hit the ground. He was healthy, well respected in the community and loved by both his family and myself. It was horrible, and completely unexpected.

What can you do?

Now that I have your attention, and hopefully have you in the mindset of realizing that you are no different than the thousands, maybe millions of other people in the world impacted by unexpected, uncontrollable life changing events, here’s a few things you can do to to prepare for when tragedy strikes:

Get Life Insurance

If you have a spouse or children that are dependent on your income, you need life insurance. It’s no more or no less complicated than that. What of your chances of dieing? Slim, but do you really want to risk your families future on statistics? I don’t.

Get term life insurance. Depending on your situation, I would recommend 8 – 10 times your annual salary. Term life insurance is cheap, and should be considered a necessary expense just like the power and water bill. I have mine with State Farm and they have a neat calculator that will help you determine how much you really need.

Do not and I repeat Do not let your insurance agent sell you whole life insurance. Do not confuse life insurance and investing, they are not the same. If you want to invest, open a mutual fund. Let you insurance company handle the insurance and your brokerage company handle investing. Insurance agents make big commissions on whole life insurance, and trust me they will really turn on the sales pitch, show you numbers, use your emotions, etc, etc. Just say no.

If you have a family and you don’t currently have life insurance, stop reading right now. Open up another window, do some quick research and get life insurance. Maybe even call your companies HR department, as companies often offer life insurance policies at group rates that are very cheap. That is what I have. I am insured at 12x my salary. 8x through my employer, and 4x through my State Farm agent.

Don’t wait, you might need it sooner than you think.

Health Insurance

It amazes me the number of people that don’t have health insurance. I know, here in America our heath insurance and associated costs are just plain crazy, but you need it. Just like you need water and food, you need health insurance. Sure, for those twice yearly doctor visits it may or may not be worth it, but if some really bad happens, like a brain tumor it will make all the difference in the world.

As I said with life insurance, if you don’t have health insurance, stop reading now and go get it. If your company offers it, get it through them, it is much cheaper. If they don’t, go get independent insurance. A number of health care providers offer independent insurance. If you are self employed, a number of associations or trade groups offer group plans you can take advantage of for a small yearly fee. This is a good option.

What if you can’t afford it? Can you afford not to? Seriously, if you don’t have health insurance, take a hard look at your expenses. Make a budget, reduce your expenses, and include health insurance as part of your overall budget.

Long Term and Short Term Disability Insurance

Depending on your financial situation, you may not require short term disability. What I mean is if you have a significant emergency fund, you might not require the guaranteed income from short term disability.

Long term disability in my opinion is required. Regardless of your profession you need long term disability insurance. Some professional office workers don’t think they need it, I mean after all, who much damage can a paper cut or carpel tunnel syndrome due right?

What if you have get cancer, have a stroke, take a baseball to the head while playing ball with your kids and get permanently brain damaged (yes this happened to a church member of ours)?

Talking with Rich’s wife yesterday, she said the long term disability insurance was a God send. It has made all the difference in the world in her ability to pay the medical bills and cover what the insurance hasn’t covered.

A number of large employers offer long term disability at a fairly low cost. I would strongly advise you to consider it. Unfortunately with my tumor, I applied and was denied so I am looking at other options and will keep you posted on these as I learn more. If your employer doesn’t offer it, do a little Google searching, and you will find a number of companies offer really good plans.

Wrapping Up

I know this post isn’t in line with my typical up-beat and positive articles, but visiting with Rich in the hospital this week, I was snapped into reality about what can happen to you in the blink of an eye. While we can’t control the things that will happen to us, nor can we always control the outcome, we can take steps to mitigate the risk and impact of these events. We can take steps to make things easier on our friends and loved ones when life throws us curve balls, or when the Lord calls us up.

Remember, we don’t know when today may be our last day. We don’t know what tomorrow will hold. Be prepared and be responsible to yourself and your loved ones.

Proverbs 22:3 – “A prudent person foresees the danger ahead and takes precautions; the simpleton goes blindly on and suffers the consequences“

* Names have been changed to protect their true identities

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