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Money Smart


How to Save Money on Healthcare

Healthcare is one of the biggest expenses in Australian households and it is getting progressively more expensive. A recent study revealed some shocking statistics – 62% of bankruptcies are a result of healthcare expenses or income loss during illness.

In such a scenario, a question that many people are asking is, how can I save money on healthcare? It’s easier than you think to make sure you’re not spending money on medical costs where you can actually be saving it.

1. Understand new laws

Read up on the provisions that are laid down in laws like the Affordable Care Act. According to this law, children up to 26 years can still be covered by the policies of their parents. You may even be eligible for insurer rebates. According to the law, 80% of premiums collected by insurers are supposed to be spent on medical costs for customers. If your insurer hasn’t met these terms, you may qualify for a rebate.

2. Make sure your doctor is in-network

Doctors and hospital that are in-network are usually under contract with your insurance company. Such in-network medical expenses are significantly more affordable because they are agreed upon between the insurers and the doctor. If you get a bill that you think is wrong, always follow through. Also, each time you make an appointment with your doctor, find out if they are still in-network. Physicians may be re-evaluating the plans that they have accepted from time to time.

3. Take measures to prevent illness and stay healthy

New laws like the Affordable Care Act will cover certain preventive care such as immunization, mammograms, breast-feeding support etc. without a need for co-pays. You can use these provisions to save money. If your medical insurance was formulated after 2010, you’ll be able to benefit from these provisions. But even if your insurance was drawn up earlier, you can challenge any bill that you find has errors on it.

4. Know how to negotiate

Negotiate to get your hospital bills lowered. It is not only possible, but a survey in 2005 had discovered that 70% of ex-patients at hospitals were able to get their bills lowered. If you are uninsured or have suffered from recent financial hardships, you are more likely to succeed in this. If you are unsure of what price to quote, you can look up how much Medicare covers on websites like Then call the billing manager and offer the amount. You will find that being able to pay in cash then and there will sometimes get your costs reduced by as much as half. In addition, if you are having several procedures being done at the same time, you can get a discount.

5. Look for cheaper medication

In place of brand name drugs, a large number of Americans choose to buy generic drugs. Generic drugs are FDA approved and have the same active ingredients as brand name medications. Manufacturers are able to make them more affordable because they are already tested in advance by patent-holding companies.

Even if you choose to buy branded drugs, it is useful to find out the kind of benefits offered by the pharmacy. This will help you choose the drugs that are available at the lowest prices. If you are prescribed a medicine by your doctor and it is not included under your plan at low prices, ask your doctor for an alternative medicine that you will be able to buy for less.

6. Don’t let doctors or insurers talk you into treatments you don’t need

If you are being prescribed a test that is expensive, always ask your doctor why you need the test. Find out if you can postpone it and if doing so will affect your condition. Some tests like bone-density scans, EKGs and MRIs may not be needed by every patient. If you talk to your doctor about the procedure and the potential costs in advance, then you will give your doctor the opportunity to make changes in your treatment.

If you are employed with a company, you will find that employer plans will offer the best benefits. If you can find an insurance agent you will have access to a variety of plans. Insurance companies will cover the cost of an agent, so if you have an insurance plan you won’t have to pay anything out of pocket.

This was a Guest Post by Brenda Panin, passionate finance and business blogger. Brenda is interested in topics related to saving money by purchasing insurance or saving money on health care. She enjoys seeing her readers getting useful information from her articles.

Put on Your Thinking GAP: A Guide to GAP Insurance

gap-insuranceThat said, GAP insurance is incredibly useful, regardless of whether or not you find it interesting. In fact, the decision to purchase GAP insurance might be one of the smartest decisions to make when purchasing a new car.

After all, accidents are somewhat inevitable—especially if you’re raising teenagers. Experience has taught me that it’s better to be prepared than it is to trust your luck (or the dealer from whom you’re purchasing your vehicle) and hope everything works out.

Now, for those of you who have been operating under the assumption that GAP insurance is part of your dental payment plan, allow me to explain: GAP insurance (also known as Guaranteed Auto Protection or Guaranteed Asset Protection) is a policy that covers the difference between the actual cash value of the vehicle and the balance you still owe. This comes in handy if you (or those rambunctious teenagers you’re trying to raise) happen to crash that brand new car you just bought.

Here’s an example—say you purchase a car for $15,000 (with a down-payment of $2,000). You’re leaving the dealer’s lot when you’re gripped by a sudden and ferocious fit of sneezing that causes you to lose control of your car and crash headfirst into a minivan packed with teenagers.

Now, normally, you’d be in pretty hot water. After all, the value of a vehicle depreciates the minute you drive it off the lot—sometimes by as much as 25-30%. This means that, even in a world where your new car isn’t a mangled piece of garbage, you still wouldn’t be able to sell it for much more than $12,000.

Let’s say, for the purposes of this example, that the minivan does $5,000 worth of damage to your new car. Your “brand-new vehicle” is now worth $7,000. This is a huge problem, since you still owe the dealer $13,000. Where are you supposed to get that extra $6,000?

Luckily, you’re an intelligent, forward-thinking individual who researches automobile insurance so, naturally, you chose to pay a little bit extra to purchase GAP insurance. While it’s pretty unfortunate that you functionally paid someone $2,000 to crash a car, the situation could have been worse. If you hadn’t purchased GAP insurance, you’d be out $8,000 (as opposed to $2,000).

As you’ve probably already realized, GAP insurance is more of a debt cancellation agreement than an actual insurance policy. That said, it’s worth investing in—especially if you just bought a new car. It’s easy to find, relatively cheap and it can save you major headaches in the long run.

So prove you don’t have a gap where your brain should be! Purchase GAP insurance!

Erin Patrick is a car enthusiast and has been associated with the automobile finance industry for nearly 10 years. She enjoys writing on the subject and helping consumers and businesses alike find the best car financing available.

A beginners Guide to Business interruption Insurance

One of the most important insurance cover for any business is that of loss of profit. Business interruption insurance covers the loss to gross profit. Theoretically speaking, this loss can be calculated in terms of the reduction in turn over and increased cost of working. But, intangible aspects of the business might make complicate things a bit.

To begin with, it is worth noting that property damage insurance and business interruption insurance are generally included in one insurance policy. The later is triggered by physical damage to insured property. The maximum period of indemnity and the insured gross profit will have to be agreed at the time of inception only.

How to calculate reduction in turnover?

For calculating the reduction in turnover, subtract the turnover during the period of interruption from the turnover achieved last year during the same time period.

This is particularly true for the manufacturing business. When there is a reduction in the turnover, the cost of the business also a decline. For instance, the cost of material, packaging and freight all go down. To accommodate these reduced costs, the rate of gross profit is then multiplied by the reduction in the turnover.

What is rate of gross profit? It is the percentage of the business turnover, which was the gross profit in the last finical year.  Taking the sum total of the reduction in turnover and the rate of gross profit will give you the value of claim.

But, as simple as it sounds, there are a number of broad adjustments clauses included in the definitions of the standard turnover that play an important role in determining the claim value.

How to calculate the rate of gross profit?

The simple formula for calculating the gross profit is (based on the previous year stats):

[Turnover x closing stock] – [uninsured working costs x opening stock] = Gross Profit

It is important to calculate the gross profit and the rate of gross profit because it is going to have a huge bearing on the insurance outcome. Insurance brokers in Melbourne will work this out for you. There are some policies that will list the uninsured working costs, but the other might not do that. In general uninsured working costs are referred to the costs are directly proportionate to the turnover. For instance, if business operation comes to standstill, there will be no packaging costs too.

The real problem arises when the uninsured working costs are not clearly listed. What has to be considered and what has to be left out, has to be carefully seen through. It becomes tricky for even the most experienced insurance consultants when there are huge changes in the working costs over the last year. For instance, if the costs of the goods have increased significantly over the past one year, so much so that it makes the rate of gross profit drop down drastically, there is every possibility that the ultimate claim response goes lower. In case, the cost of the goods sold has reduced, who knows the same rate of gross profit might increase manifold.

The business interruption insurance cover seems to be a tad bit more complicated than other insurance covers; therefore, it is advisable to seek expert advice on Industrial special risks insurance before making any claims.