Health insurance: How to save

If you're waiting for the government to solve the problem of health insurance premium increases that outstrip inflation, you'll have a long wait.

This will be a hotly contested issue in the years to come, which will lead to more debate after that.When all is well with our healthcare system and we're still alive, good.

In the meantime, let's look for ways to take action now.

First we may need to make a paradigm shift.

We can't view health insurance as an entitlement benefit.We are used to our employer having a very nice health plan.

If you want a plan that pays out every time you access the health care system, no matter how minor your complaint, you're going to pay for it.

Be reasonable.

Imagine that we had a "car benefit plan" that paid out every time we had something done to our car.

How much would it cost? Say it paid for oil changes, car washes, and new tires.

How would the plan adjust for the cost? Yes, by raising premiums.We pay for car insurance to minimize the catastrophic risk.

That's the concept of insurance.

It's no different with health insurance and health plans.We need to decide whether we want a benefit plan or straight insurance.

Want straight insurance? Here's what you can do: Take care of yourself and your family members.

Every time we do something consistently unhealthy it's going to catch up with us.

To illustrate: if we drink and drive, sooner or later we are going to pay for it either with damage to our car, someone else's car or even a life.

But avoiding alcohol when driving is within our power.

The same is true of our bodies.

We have an incentive not to do anything that tests our fate with the healthcare system.

The more we stay out of it, the less money it's going to cost.

Even if we are on our employer's plan, our unhealthy lifestyles will affect our premiums as a group.

So take control as much as you can and live healthier lifestyles.

Eat and drink nutritiously and abstain from abusive habits and lifestyles such as smoking.

All that comes out in overall savings, both for others and ourselves.

Look into purchasing a catastrophic health insurance plan.

Many of us believe that if we're not getting as much money out of our health plan as we're putting in (in premiums) then it's a rip off.

If you have that viewpoint (I do myself ), then buy a high-deductible plan.

Purchase an insurance package with a $2,000, $3,000, or even $5,000 deductible then put the difference you save in premiums in a vacation account.

For those who are self-employed or own their own business, look into an MSA (Medical Savings Account) program that will allow you to set the money aside in a tax-deferred account.

You'll be allowed to pay for medical expenses that go toward your deductible with tax-qualified money.

If you don't use the money, it will carry over year after year which can be used for any reason at age 65 just like an IRA.

"But my employer pays for it," you say.

Then thank your employer for its kindness and discuss the possibility of offering a stripped-down version in the group plan for those that would rather spend the money saved on the reduction of premium elsewhere and insure against catastrophic loss.

Perhaps your employer can provide an incentive as a buy-up option.

Go a step further and ask about offering an MSA alongside the traditional health plan.

If your employer insists on keeping the current plan, look into purchasing a high-deductible program for your dependents who are healthy, because in many cases the employer does not pay for dependents.

If it's too good to be true, it's not real coverage.

Companies offer health plans for $49 a month.

These are discount plans, not true insurance products.

So if you have a catastrophic claim you'll receive a 20 percent to 50 percent discount.

You pay the rest.

You get that anyway when you purchase a highdeductible, PPO indemnity-based insurance plan.

You receive the PPO's network- negotiated discount and the insurance as your risk is capped at the out-ofpocket limit.

That's what you want: Peace of mind, not an unpayable hospital bill.

Don't fall into the philosophy that if you're not using my health insurance you feel cheated.

Like any other form of insurance, it's better not to need it.

But if you do need it, it's there to protect your financial well being, not to smooth the ups and downs of normal everyday living.

Talk to an agent.

If you don't know of one, find out who your employer uses, and discuss your situation with him before making any changes.

Professional advice can go a long way in avoiding pitfalls.

It's a tight insurance market, but with some planning and research we can take matters into our own hands and save money on health insurance.

Peter Breen, an employee benefits specialist since 1994, launched Breen Insurance Services in Reno in 2000.He earned the Life Underwriters Training Council Fellowship and is a member of the local organizations of the National Association of Insurance and Financial Advisors and the National Association of Health Underwriters.