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· 24 Dec 2021

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Why is health insurance so expensive

If you’re having trouble getting affordable health insurance, you’re not alone. In fact, rising costs of care are one of the most common reasons Americans end up uninsured. If you are thinking about getting insurance, or if you already have it, then this article will help you understand what affects how much it costs and what you can do to get the best deal.

Overlap with other benefits
Health insurance isn’t just for catastrophic, unforeseen events. It can also cover you for preventative care—including checkups, screenings, immunizations, and other routine visits to your doctor. So why are co-pays and deductibles increasing? Because healthcare providers aren’t allowed to price-discriminate based on age or medical history; insurers need to make up that difference somehow.

The easiest way is to charge more to those who use it more. If we want affordable healthcare, we should advocate for letting insurance plans set rates based on risk factors like gender, weight, and family history—and then let consumers pay accordingly. To take advantage of these savings, individuals will have to be willing to buy policies without considering the price (or get penalized if they don’t). That makes some people uncomfortable because we tend to associate higher premiums with higher risks.

Premiums, deductibles, co-pays
Your total cost of coverage has three main components: your monthly premium, your annual deductible, and any co-pays. For example, if you’re paying $600 a month for coverage and have a $1,000 deductible before your plan kicks in, you’ll pay all of your healthcare costs until you reach that point. Once you hit that deductible, then your plan will start to cover expenses up to its out-of-pocket maximum ($4,500 per person; $10,500 per family). If you visit an out-of-network doctor or hospital that doesn’t accept your insurance (or does but won’t discount their rate), it can also trigger higher out-of-pocket costs. On top of everything else, some services may not be covered by a certain network or provider network.

What are the true costs of health insurance?
The only thing you need to know about most policies today is that they charge way too much for things you don’t need and don’t cover what you do. If you want a good policy, it will cost at least $2,000 per year for a healthy adult. If you have a family, it could cost over $8,000 per year. Why does healthcare cost so much? Let’s take a look at some of its hidden costs.

What can be done to keep the costs down
When dealing with high costs, it’s easy to get discouraged and wonder if there’s anything you can do. But it’s important to remember that a few small steps can go a long way toward reducing health care expenses—and keeping you healthier. Make sure you understand your coverage before your appointment and ask questions during your visit so that you can stay within your policy limits. If your coverage allows for pre-certification, use it