6 Tips for Everyone Who Wants to Buy Health Insurance in 2016

Health insurance is not an option but a compulsion. You might fall sick and need to stay in a hospital for few weeks. Or even worse, the doctors prescribe you a surgery. How would you manage to pay for it? Either by breaking your savings or by borrowing money. That leaves little choice other than to buy health insurance.

Having a health insurance means you won’t have to do any of the above. It makes you self-dependent and relieves you from worries. The bad news is that Congress might soon revoke Obamacare, which brought a smile to many faces around us. Don’t believe me? Okay, read this.

(EDITOR’S NOTE: Tina’s article deals with the mechanics of applying for Obamacare, and I’ve agreed to publish her post. However, long-time readers are aware that I believe that Obamacare is a failed program to be used only as a last resort, and only after exhausting all other possibilities. Obamacare health plans are expensive and come with high deductibles that make them even less affordable than the previous health insurance plans that Obamacare has replaced. I applied for Obamacare for my family in 2015 and we made the decision not to go forward with it.)

The Message is Clear

6 Tips for Everyone Who Wants to Buy Health Insurance in 2016
6 Tips for Everyone Who Wants to Buy Health Insurance in 2016
That there would be no free or subsidized meal, and you’ll have to arrange it yourself. Insurance policies, these days, are like double-edged swords. Their cost has been steadily increasing over the last few years, and the coverage limits have been systematically decreasing.

You need a policy with high coverage limit and flexible rate of premium. It’s difficult unless you shop around, and follow the tips I’m going to lay down below:

Outpatient procedure alternative

People often buy policies with high deductibles, which they hope will cover visits to the local doctor’s chamber. The coverage costs around $100 for each single patient. There’s a much cheaper alternative, which costs around $60. Visit your local drugstore to know whether they run an in-store clinic. Doctors in such clinics charge an affordable amount.

If your local drugstore doesn’t run an outpatient clinic, no problem. There are many drugstores that do, and you need to find them. Google can be of excellent help for this pursuit.

Employee health care

If you extend the health care benefits offered by your employer, you could easily save bundles of money. Some smart ways of doing that are squeezing the wellness package, taking full advantage of the FSA, using voluntary benefits in your favor, etc.

The wellness package, more often than not, consists of some sort of quit smoking program, waivers on a gym memberships weight loss schedules and guidance related to personal health. The FSA, or flexible spending account, allows you to keep a portion of your earnings aside before paying the income tax. You can not only use this money to pay for any outpatient visit, but also to pay deductibles for your existing health insurance plan.

As for voluntary benefits, not all employers offer it. If your employer offers it, ask them what features the package includes. If it includes services such as disability insurance, opt for it because nobody knows what’ll happen in future.

Avoid penalties

Opting for a low-deductible insurance is one thing, but not opting for any insurance is a completely different thing, so much so that doing it in 2016 can result in penalties. At the time of filing your income tax return, you’d have to pay the penalty as a fee.

I advise you get a health insurance this year because the penalty fee for 2016 will be much higher than in 2015. There are two methods to calculate the penalty. The first is charging you 2.5% of your annual household income upfront, and the second is $695 for each member 18 years of age or older and exactly half of that amount for those younger than 18.

Special enrollment period

There seems to be a carrot-and-stick strategy at work. You get penalized if you don’t enroll (the stick) and enjoy an extended enrollment period (the carrot) in certain events. You are only eligible for a special enrollment period if you have qualifying life event.

What makes up a qualifying life event? It’s an event that changes your insurance needs as well as status. The time you get to enroll after a qualifying life event is no less than two months. However, if the plan is through your employer, then the time limit is short, only a month. Some of the qualifying life events are getting married, losing existing health coverage, moving to a new home, having a kid, adopting a child, etc.

The list doesn’t end here as it includes few other events. I suggest you consult with an expert and get to know all qualifying life events to decide whether or not you have the sixty days grace period.

Financial assistance

Whether you are qualified for it depends on your income. At the time of enrolling, put the expected income for 2016 in the relevant section of the form. You’d feel assured to know the majority of people, who apply for a premium tax credit, receive it, and their monthly insurance premium is lowered.

Apply today

The tips given here are to enlighten you. If you are uninsured, don’t waste time and apply today while taking them in stride.

What do you think of the tips? Do you have anything to add? Let us know in the comment section below.

Tina Roth is the Founder and Editor of the Money Management Finance Blog – a personal finance blog for money management and living a frugal life. Follow Tina in Facebook, Twitter, Google+.

( Photo by pasa47 )

3 Responses to 6 Tips for Everyone Who Wants to Buy Health Insurance in 2016

  1. If you think looking into healthcare plans are confusing, try looking into plans when you are eligible for Medicare. My first annoyance is the fact that I will be already be paying for Medicare right out of my Social Security and it is not the cost listed on Medicare but the higher cost because It is the new 2016 cost. so I had to readjust my budget to reflex this cost. In researching what coverage I have with basic Medicare versus another plan, one cost I have to add is drug coverage, which varies depending on what drugs one uses. Fortunately I am in good health and take no drugs ( a factor I want to maintain as long as possible). So I did the next step in questions in my comparison, what additional coverage do I get or need. I wanted vision and dental coverage,too (not covered by basic Medicare either). I compared online a few and then made some calls. I had to really take control of the conversation because they only want to sell not answer questions unless forced. I was finally able to get the information I was looking for–i.e. where is coverage available in my geographic area ( yeah they don’t want to tell you that unless pushed), where to go for services in my geographic area. As i am a person who uses public transportation, I need doctors and services to be close enough in reasonable travel zone (less than 5 miles). I also noted which plans had 24 hour call help versus those who only work 9-5 their time M-F. I know that the healthcare system wants people my age to have very limited sources of help so any blocks I can avoid is great. I also noted what walking clinics are supported by programs where I can go for simple services like flu shots,etc. Now I am ready to pick.

  2. Hi Maria – What you’re reporting destroys the myth that all of our healthcare worries will be over when we go on Medicare. That’s frustrating. At all levels, healthcare and health insurance are getting way too complicated (and expensive) for us regular folks. We have to hope that the future brings true healthcare reform that will straighten this all out. Until then, we plod along with a very dysfunctional system.

    I read a post today on Charles Hugh Smith’s blog where he wrote about a friend from Uruguay who lives in the US but returned to that country for a routine physical. The reason: the cost of the physical in Uruguay was less than the cost of the plane ticket there and back, and she was able to get the appointment the next day, rather than in two months as it would take in the US.

    So much for having “the best healthcare in the world”. Even if that’s true, it does little good if you can’t access it and/or can’t afford to pay for it.

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