Article originally published to psychologytoday.com on February 18, 2025.
Key points
- The average American spends more than $10,000 annually on healthcare, with out-of-pocket costs rising rapidly.
- Medical billing errors are common—reviewing and negotiating bills can help reduce costs significantly.
- Urgent care clinics and telehealth visits are often faster and far cheaper than emergency room visits.
We all know medical care has gotten outrageously expensive—and it just keeps rising. Insurance costs more while covering less than it did just a few years ago.
In fact, the average American now spends more than $10,000 annually on healthcare. Out-of-pocket expenses (those not covered by insurance) are more than $1,200 per person per year—and are rising by more than 10 percent annually. These aren’t comforting trends.
We can debate political solutions all day, but the truth is that major change won’t happen overnight. Our healthcare system is simply too massive to transform quickly. So, beyond voting (or running for office), what can you do to limit your costs right now?
Ensure You Have Catastrophic Healthcare Coverage
Even if you’re healthy, having no insurance is a financial disaster waiting to happen. A hospital stay without coverage can be financially devastating.
Catastrophic plans are relatively affordable, and subsidies are available for those who qualify through Healthcare.gov. If you’re eligible for Medicaid or Medicare, enroll as soon as possible—these programs offer significant savings.
Think of health insurance the way you think of car or home insurance: It’s there to protect you from major financial losses, not to cover every minor cost.
Use Generic Medications Whenever Possible
Why pay more for the same results? Generic medications are typically 80 to 85 percent cheaper than brand names and work just as well in most cases.
Shop Around for Medications
Medication prices vary by up to 600 percent between pharmacies on the same block. Instead of paying more than necessary:
- Ask if a 90-day supply or mail-order option is cheaper.
- Surprisingly, some medications are cheaper without insurance—ask your pharmacist to compare.
- If you take a brand-name drug, check with the manufacturer—they often have payment assistance programs.
Avoid Hospitals for Non-emergencies
Hospitals (and anything affiliated with them) tend to be the most expensive option for care. Emergency rooms (ERs) are meant for life-threatening conditions—not minor issues like a sprained ankle or fever.
For urgent, but non-emergency situations, consider:
- Urgent care clinics—cheaper and faster than ERs.
- Your primary care doctor—many have same-day or after-hours appointments.
- 24-hour on-call services—most primary care providers offer this to help determine if a visit is necessary.
Planning a Procedure? Avoid Surprise Bills
If you’re scheduling a non-urgent procedure (e.g., a colonoscopy or minor surgery), choose a surgical center instead of a hospital whenever possible.
Before scheduling, call and confirm:
- Is the surgeon in-network?
- What about the anesthesiologist and pathologist (if needed)?
Many people assume they’re covered—until they get hit with a surprise bill. A quick phone call can save you thousands.
Ask More Questions About Treatments
The U.S. healthcare system over-tests and over-treats many conditions. Sometimes it’s driven by fear of liability, sometimes by financial incentives, and sometimes just out of habit.
Before agreeing to a treatment, ask:
- Is this necessary?
- Are there alternatives?
- What are the risks vs. benefits?
- How much will this cost?
If the answers aren’t clear or convincing, consider getting a second opinion or asking about less aggressive options.
Review and Negotiate Your Bills
Medical billing errors are common, and even correct bills can often be negotiated. If something looks wrong—or just seems excessive—call the billing office.
- Mistakes happen—billing codes get entered incorrectly.
- Hospitals may offer discounts if you ask.
- Payment plans are often available (even if they don’t advertise them).
It doesn’t hurt to ask—and it could save you hundreds or even thousands.
Prioritize Prevention
The best way to cut medical costs? Avoid needing care in the first place.
A healthy lifestyle doesn’t just make you feel better—it saves money. Studies show that diet and exercise alone can reduce lifetime medical costs by $30,000+.
- Eat well and stay active.
- Get routine check-ups.
- Stay up to date on vaccinations and screenings.
It’s an investment in both your health and your wallet.
Use Your FSA or HSA
If you have a Flexible Spending Account (FSA) or Health Savings Account (HSA), use it. These accounts let you pay for medical expenses tax-free, which can mean big savings each year.
Final Thoughts: Take Control of Your Healthcare Costs
Medical bills can be confusing, stressful, and expensive—but small changes can add up to big savings.
- Compare prices on medications and procedures.
- Use urgent care instead of the ER for minor issues.
- Ask questions before agreeing to treatments.
- Negotiate bills and use financial assistance programs.
- Prioritize prevention—invest in your long-term health.
A little research now can save you thousands down the road. And wouldn’t you rather spend that money on something you enjoy—instead of medical bills?