How to get cheaper health insurance

You have options when shopping for health insurance. Experts agree that it pays to carefully research your choices and explore alternatives. It can mean saving a lot of money regardless of the type of health insurance plan.

"Health care expenses are becoming more like retirement, where the responsibility is increasingly on the consumer," says Brian Colburn, senior vice president of Corporate Development & Strategy at Alegeus, a consumer-directed healthcare company based in Boston. "The challenge with this is that 88% of consumers don't know how to best save and spend on their health care, and this hasn't changed much over the past five to 10 years."

Out-of-pocket spending grew to $433.2 billion in 2021, the most recent National Healthcare Expenditure data.

"It's important to go the extra step and explore ways to save on health insurance because every family has different needs and these costs can vary widely," says John Bartleson, owner of Health Benefits Connect in Englewood, Colorado. "Additionally, it's wise to understand all the different types of coverage available. If you are not well-informed, you may choose inadequate or ill-suited plans and face surprise costs."

How to save money on an employer-sponsored plan

Employer-sponsored group insurance coverage is usually the cheapest option for coverage, since it's subsidized by the company. But, if your employer gives you multiple options, take the time to compare your choices and consider these suggestions to save:

  • If your spouse or partner has an insurance option through their employer, compare the cost of adding them to your policy vs. using their own coverage.
  • Consider a high-deductible health plan (HDHP), which can save you a lot of money if you don't anticipate many healthcare costs in the coming year.
  • Use a health savings account (HSA) if available, to put aside money tax-free for out-of-pocket costs. Your employer may even contribute for you.
  • If you’re under 26, try to stay on your parents' health insurance if possible. The Affordable Care Act lets children stay on their parents' health plan until the age of 26.
  • Look into "stacking," a strategy that involves stacking multiple insurance plans together. A common approach is to buy a cheap HDHP plan and combine it with a plan that helps pay out-of-pocket costs. This, however, can be complex and may not be the best way to simplify and save at the same time.

How to save money on an individual health plan

If your employer doesn't offer health insurance, or if you are self-employed, you can still find ways to save on an individual health insurance plan.

  • Shop and compare all of your options on the healthcare marketplace, which will show you all of your options for Affordable Care Act (ACA) plans.
  • Find out if you qualify for a subsidy on an ACA plan; the healthcare marketplace site will tell you when you enter a few details about your finances.
  • Compare ACA plans to those available on the open market, outside of the marketplace options, as they might be cheaper.
  • Consider your anticipated healthcare needs and choose the plan that will best balance your monthly premiums with what you'll pay if you need care.
  • Look into a catastrophic health plan if you qualify; it's available to people under 30 in good health and those with financial hardships and is the cheapest in terms of monthly costs.

Save money on your current plan

Already enrolled in a health insurance plan? Consider these strategies to generate more savings.

  • Use your HSA to its fullest; make sure you put enough money into the account and know all of the ways you can spend that pre-tax money.
  • Sign up for a prescription discount card, which may offer cheaper prescriptions if you don't have the coverage on your plan or don't have great coverage.
  • Stay in-network for care; even if you have a PPO plan that pays for out-of-network care, you'll pay less if you stay in-network.

Research your health insurance options to save

Health insurance savings are possible if you're willing to do the work.

There are a lot of plans out there to choose from and even if your options are limited by what your employer offers, you can still find ways to trim your budget. Like anything else you buy it's important to understand your needs and shop around to find what works best for you.

Check out our health plan finder for an easier way to find the right health insurance.