45% Insured Americans Avoid Medical Care Due to High Costs
- About 45% of insured Americans have avoided medical care due to fear of high costs not covered by their insurance, as per a study by Policygenius. This avoidance can lead to health issues getting worse and becoming more expensive to treat.
- One way to manage healthcare costs is to save money specifically for such expenses. This can be done by putting money in a savings account or contributing to an account like a flexible spending account (FSA) or health savings account (HSA) that offer tax breaks. However, FSAs operate on a use-it-or-lose-it basis and HSAs require your health plan to conform to certain qualifying rules.
- A recommended benchmark for savings is the amount equivalent to a person’s health insurance deductible. This provides protection and enables individuals not to ignore health problems due to financial constraints. The deductible is the amount you are required to pay before your health insurance covers your care costs.
You Need Health Insurance But It’s Not Enough
While it’s risky going without health insurance, having coverage doesn’t necessarily make medical care affordable. A survey by Policygenius found that 45% of insured Americans have skipped medical care due to cost concerns. This practice could aggravate health issues leading to higher treatment cost.
Importance of Health Savings
Setting aside money for healthcare expenses is essential for avoiding health and financial risks. There are several ways to save for healthcare costs. One of these is simply by increasing your savings account. Alternatively, you can opt for accounts that provide tax breaks.
Healthcare Savings Options
A Flexible Spending Account (FSA) is a good option. Although, remember that FSAs typically operate on a use-it-or-lose-it basis. Another great choice is a Health Savings Account (HSA). Unlike FSAs, HSA balances roll over each year and you’re encouraged to invest your balance tax-free. However, to qualify for an HSA in 2024, your health plan must meet specific criteria.
How Much Should You Save for Healthcare?
As a guideline, you should have enough savings to meet your health insurance deductible. According to the Policygenius survey, 28% of insured people can’t afford their deductibles. Having your deductible saved provides a safety net. Although, aiming to save beyond your deductible amount is even better.
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