Though health insurance offers significant financial protection, how can you ensure you’re choosing the right plan? 

Whether you’re trying to find the right plan to choose through your employer-sponsored coverage, or you’re just beginning to look into your individual health insurance options, our team  at Insurance Bargains is dedicated to helping you navigate the confusing and complicated world of health insurance so you could stay healthy without breaking the bank. 

The Basics of Health Insurance 

Employer-Sponsored 

A health insurance policy selected and purchased by your employer and offered to eligible employees and their dependents. Your employer will typically share the cost of your premium with you. 

Individual Plans 

An individual health plan is one you purchase on your own, not through an employer. You can purchase these from a health insurance exchange, also referred to as the health insurance marketplace. 

Family Plans 

A family health insurance plan is essentially the same as an individual plan but with dependents added to the policy. 

Medicare 

A federal health insurance program that insures seniors aged sixty-five and older. Beneficiaries can choose their coverage through a private insurance company with a Medicare Advantage plan or through the government. 

Short-Term 

A short-term health insurance plan can help to bridge any gaps in coverage you may encounter. 

Dental & Vision

Generally speaking, most medical insurance plans don’t cover routine dental or vision care. You’ll need to enroll in separate plans to meet these needs. 

HMO vs. PPO

Health Maintenance Organizations (HMOs) is a plan that offers members care within a specific network of doctors, hospitals, and other medical providers, otherwise known as in-network providers. 

Preferred Provider Organizations (PPOs) offer more flexibility where you seek care. You can schedule appointments with out-of-network doctors and see specialists without getting a referral. 

Key Health Insurance Terms You Should Know

• Premium: The amount of money you pay to your health insurance company each month to keep your coverage. 

• Deductible: The amount of money you pay out-of-pocket before your health insurance pays for health care services. 

• Copay: Cost-sharing payments you may have to make out-of-pocket when you receive certain health care services or medications. 

• Coinsurance: Another type of cost-sharing payment you have to make out-of-pocket when receiving health care services or medications. 

• Out-of-Pocket Maximum: The cap on how much you’ll have to pay out-of-pocket for health care in one year. Once you’ve reached this amount, your insurer will pay for your covered care for the rest of the year. 

Open Enrollment Made Simple 

An open enrollment period is a window that occurs typically in the fall when you can sign up for health insurance, adjust your current coverage, or cancel your plan. 

Unless you experience a qualifying life event such as a loss of coverage through an employer, significant family changes, or loss of coverage through a covered employee, you will have to enroll for health insurance during the open enrollment period. 

You Lost Your Employer-Sponsored Insurance… Now What? 

If you’ve lost your employer-sponsored insurance due to job loss, your next steps might seem daunting. However, you may find that you have options due to a special enrollment period. 

The Consolidated Omnibus Budget Reconciliation Act (COBRA) requires employers with more than twenty workers the opportunity to continue their health coverage for up to 18 months after their position has ended. This coverage includes you, your spouse, and other dependents on your plan. Generally speaking, you would have at least sixty days to enroll in COBRA coverage. 

Another option is to sign up for an Affordable Care Act plan (ACA). Though you typically sign up for health insurance during Open Enrollment, losing your job qualifies you to enter a Special Enrollment Period to choose a new plan. 

While short-term insurance is not the same as Marketplace coverage and is not required to cover minimum essential health benefits, it may be an optimal option for individuals who need a bridge of coverage and cannot wait for Open Enrollment or do not qualify for a Special Enrollment Period. 

If you have a limited income, Medicaid may be the perfect option for you. While you can apply at any time, there are set criteria for you to meet in order to qualify. 

Final Thoughts

Health insurance is a safety net meant to take care of your financial well-being when life continues to offer you unpredictability. Ensure you’ve done your research so that you could choose the right coverage for you and your family.

Across the United States, Americans pay wildly different premiums monthly for medical coverage. Though these premiums are not determined by gender or pre-existing health conditions, a number of other factors may impact how much you pay. If you don’t have a clear idea of your expenses, you may feel like you are not in control. However, when you become familiar with all the costs, you may be able to make the right choices and regain control. 

To get a better understanding of your health insurance costs, it is important to first look at all the key types of costs. 

Premium

A premium is the amount of money charged by your insurance company for the plan you’ve chosen. It is usually paid on a monthly basis, but can be billed in a number of ways. You must pay your premium to keep your coverage active, regardless of whether you use it or not. 

10 Factors that Affect Premiums:

1. State and federal laws dictate what health insurance must cover and how much insurers can charge. 
2. Whether you are insured through an employer’s group plan or buy it on your own
3. Your income. Low-wage workers tend to pay more though employers but may pay less through a federal or state exchange due to subsidies 
4. Your employer’s size. Insurance is usually cheaper at large companies. 
5. The state in which you reside. 
6. Where you live. Premiums tend to be lower in urban areas versus rural areas. 
7. The county in which you live. Some counties have only one plan, while others have more competition, which helps to reduce costs. 
8. The type of plan you choose. Preferred provider organizations (PPOs) and platinum plans through the federal health insurance marketplace tend to cost the most. 
9. Your age. Older individuals may pay up to three times more. 
10. Your tobacco use. Premiums for tobacco users may cost up to 50% more. 

Deductible

On top of premiums, everyone who carries health insurance also pays a deductible. Deductibles can be a big part of health insurance, and most policies include them. A deductible is a set amount you have to pay every year toward your medical bills before your insurance company starts paying. This means you pay 100% of your health expenses out of pocket until you have a predetermined amount. At this point, health insurance kicks in and you pay a percentage of your bills, with the insurer covering the rest. Most workers are covered by a general annual deductible, which means it applies to almost all healthcare services. 

It is also important to know that some plans might not carry a deductible. This is ideal in certain situations where you know you’ll have a large number of appointments or prescriptions throughout the course of a year and want to keep costs to a minimum. 

Coinsurance

Coinsurance is the percentage of the medical bill you share with your insurance company after you’ve paid your deductible. Unless you have a policy with 100% coverage for everything, you have to pay a coinsurance amount. 

Generally speaking, plans with low monthly premiums have higher coinsurance, and plans with higher monthly premiums have lower coinsurance. In health insurance, a coinsurance provision is similar to a copayment provision, except copays require the insured to pay a set dollar amount at the time of the service. 

Copayment (or Copay)

Your copayment, or copay, is the flat fee you pay every time you go to the doctor or fill a prescription. It’s usually a relatively small dollar amount and does not count toward your deductible. Copay plans spread the cost of care over a full year and make predicting your medical expenses easier. A copay plan charged the insured a set amount at the time of each service. 

Additional Expenses to be Aware Of:

Like any type of insurance plan, there are some expenses that may be partially covered, or not at all. Less obvious expenses may include services provided by a doctor or hospital that is not part of your plan’s network, plan limits for specific kinds of care, such as a certain number of visits for physical therapy per benefit period, as well as over-the-counter drugs. 

How to Estimate Your Costs:

How often might you see a doctor or need medicine? An educated guess can help you predict these needs- and what you’ll pay for them. Here are some steps to help you figure out how much care you might need going forward. 

Look Back on Past Expenses

If you keep medical receipts, go through them. Add up your costs for doctor’s visits and medicines. Or ask your doctor for a history of your payments over the last year. Your drug store may have a record of your payments for medicine too. 

Use an Online Calculator

Some websites can show you estimated insurance costs. If you have employer insurance, your company may offer a tool to estimate costs. 

Anticipate Your Family’s Health Needs

Yearly checkups for children and immunizations are free, but you will have to figure in costs for treating chronic conditions like high cholesterol and diabetes, doctor appointments, and medicine. 

Other expenses might include counseling for mental health and planned surgeries or medical procedures that you might have to share in the cost by paying a copay or coinsurance. 

Does Your Premium Count Towards Your Deductible and How is It Calculated?

Many people wrongly assume that a premium payment counts towards the insurance deductible. A premium payment is really just the cost of having the policy in place.

You must continue to make premium payments for coverage to be valid, whether you go to the doctor or not. This is very important to remember, as skipping a payment could lead to the cancellation of your policy at a time when you really need to use it.

If you find yourself continually forgetting to meet a payment deadline, consider options such as paying your premiums up front (if possible), sending the check through your online banking app, or arranging an automatic withdrawal with your insurance company.

In addition, it’s incredibly important to know that a lot of factors go into the premium calculation process. Your age, weight, whether or not you’re a smoker, where you live, and many other elements all determine how large your premium payment will be. The plan you choose also plays a crucial role in determining your premium costs.

Concluding Thoughts

No one plans to get sick or hurt, but most people need medical care at some point and purchasing the right health insurance plan is a pretty important aspect of adult life. Consider these points to ensure you are getting a good deal that matches your unique health care needs. 

Though shopping for health insurance may seem overwhelming, breaking down the process can make it much easier to digest. To help you break down this daunting process, we’ve created a guide to help simplify your steps and what you should consider.

Premiums

A premium is the amount of money charged by your insurance company for the plan you’ve chosen. It is usually paid on a monthly basis but can be billed in a number of ways. You must pay your premium to keep your coverage active, regardless of whether you use it or not. Since premiums are the amount of money you’ll pay every month for coverage, they are the most obvious expense associated with health insurance.

While it’s important to find insurance that fits your budget, the cheapest plan may not be the best. Low premiums can mean higher deductibles or a restricted network. Instead of buying based on premiums alone, the monthly cost should be just one criterion you consider when selecting a plan.

10 Factors that Affect Premiums: 

1. State and federal laws dictate what health insurance must cover and how much insurers can charge. 
2. Whether you are insured through an employer’s group plan or buy it on your own
3. Your income. Low-wage workers tend to pay more through employers but may pay less through a federal or state exchange due to subsidies 
4. Your employer’s size. Insurance is usually cheaper at large companies. 
5. The state in which you reside. 
6. Where you live. Premiums tend to be lower in urban areas versus rural areas. 
7. The county in which you live. Some counties have only one plan, while others have more competition, which helps to reduce costs. 
8. The type of plan you choose. Preferred provider organizations (PPOs) and platinum plans through the federal health insurance marketplace tend to cost the most. 
9. Your age. Older individuals may pay up to three times more. 
10. Your tobacco use. Premiums for tobacco users may cost up to 50% more. 

Out-of-Pocket Expenses

Most health insurance plans come with several out-of-pocket costs. The deductible is the amount you’ll pay upfront before insurance coverage begins. Some preventative care services, such as immunizations and cancer screenings can be exempt from deductibles, thanks to the Affordable Care Act. Health insurance policies may also charge copayments and coinsurance once a deductible is met.

Prescription Drug Coverage

It’s not enough to know your plan has prescription drug coverage. It’s also important to know that your specific prescriptions will be covered. Many insurers use formularies, or lists of covered drugs, that categorize prescription tiers. Generics may have a low copay while brand-name drugs may cost more. Keep in mind, some insurers may require patients to try lower-tier drugs first or get prior authorization before the plan will pay for expensive medications.

Networks

Most policies have networks of participating providers, so you are unable to go to whichever doctor you prefer. Using a physician or facility outside the network could result in higher copayments or even a denied claim.

Before switching health plans, ensure your preferred doctors will be covered. Since networks can change each year, it’s smart to double-check the physician list before re-enrolling in your current plan. People should also consider the type of policy that will be best for their situation.

• HMO: A Health Maintenance Organization (HMO) plan is one of the cheapest types of health insurance. It has low premiums and deductibles and fixed copays for doctor visits. HMOs require you to choose doctors within their network. When you sign up for the plan, you’ll select a primary care physician (PCP), whom you’ll see for regular checkups. Because all your health services are funneled through your PCP, it’s important to find one you trust. HMOs are a good choice if you’re on a tight budget and don’t have many medical issues.
• POS: As with an HMO, a Point of Service (POS) plan requires that you get a referral from your PCP before seeing a specialist. However, for a slightly higher premium than an HMO, this plan covers out-of-network doctors, though you’ll pay more than for in-network doctors. This difference is important if you are managing a condition and one or more of your doctors are not in-network.
• EPO: An Exclusion Provider Organization (EPO) is a lesser-known plan type. Like HMOs, EPOs cover only in-network care, but networks are generally larger than for HMOs. They may not require referrals from a PCP. In terms of premium costs, they are higher than HMOs, but lower than PPOs.
• PPO: A Preferred Provider Organization (PPO) has pricier premiums than an HMO or POS. But this plan allows you to see specialists and out-of-network doctors without a referral. Copays and coinsurance for in-network doctors are low. If you know you’ll need more health care in the coming year and you can afford higher premiums, a PPO is a good choice.
• HDHP with HSA: A High Deductible Health Plan (HDHP) has low premiums but higher immediate out-of-pocket costs. Employers often paid HDHPs with a Health Savings Account (HSA) funded to cover some or all of your deductible. You may also deposit pre-tax dollars in your account to cover medical expenses. Depending on your age, services such as mammograms, colonoscopies, annual wellness visits, and vaccinations may be covered free of charge, even if you haven’t met your deductible.

Your Claims History and Future Expectations

Knowing a plan’s deductibles and network details is most helpful when viewed in the context of your health history. People should look at their claims from the previous year for guidance on the upcoming year’s enrollment. Take into account if you met your deductible, which prescriptions you filled, and which specialists you saw. If you expect any changes in the coming year, such as marriage, the addition of a baby, or a major surgery, you’ll want to ensure your insurance will provide adequate coverage.