How to Choose the Right Health Insurance for Your Needs
There’s typically a limited amount of time during open enrollment to choose your health insurance plan but rushing through the process could cause you to pick the wrong coverage. Health insurance impacts your physical, mental and financial wellness, so it’s essential to understand your options. Read on for guidance on picking the best health insurance coverage for you.
Know Where to Get Your Health Insurance
Many Americans get their health insurance through their employer, or they purchase private health insurance directly from insurance companies. There are also public health insurance options, such as Medicaid, Medicare and Marketplace (Exchange) coverage. Eligibility for public health insurance will depend on your age, income and location. Visit healthcare.gov to learn if you’re eligible for public health insurance.
Know the Types of Health Insurance Coverage
Although you don’t have to be an expert to buy health insurance, it’s helpful to understand the different types of plans.
The following list contains some common health insurance plans for you to consider:
- Preferred Provider Organization (PPO) offers discounted rates for in-network services. Out-of-network providers can typically be used without a referral for an additional cost.
- Point of Service (POS) provides in-network services for a reduced rate. Generally, out-of-network providers can be used with a referral.
- Health Maintenance Organization (HMO) offers limited coverage for contracted doctors. Out-of-network care may only be available in an emergency. Policyholders may be required to live in a specific area to get coverage with this plan.
- Exclusive Provider Organization (EPO) provides coverage for specific in-network hospitals, professionals and medical services. With this plan, out-of-network services can be used only in emergencies.
- High Deductible Health Plan (HDHP) enables policyholders to pay less in monthly premiums by providing a higher deductible than a traditional healthcare insurance plan. Depending on the plan, HDHP participants may be able to make tax-advantaged contributions to a health savings account (HSA).
Consult your insurance agent about which insurance plan suits your needs.
Understand the Types of Health Insurance Costs
There are numerous types of health insurance costs. Understanding these costs and how they fit into your policy can help you decide which health insurance plan best fits your needs.
The following are some common payment terms you may see in your health insurance plan:
- A premium is the amount you must pay to keep your policy active. Health insurance premiums are often paid monthly but could be bi-weekly or even every week. You may be able to lower your premiums by increasing your deductible, often in an HDHP. Remember that lower premiums often increase the amount you must pay out of pocket before your insurer pays for covered services.
- A deductible is the amount you must pay out of pocket before your coverage kicks in. Once you’ve reached your deductible your health insurer will pay for some expenses. Some services, such as preventive care, may be covered before you meet your deductible.
- An out-of-pocket maximum is the maximum amount you’ll have to pay for covered health care services annually. Once you’ve hit your out-of-pocket maximum, all of your covered benefits will be paid for by your insurer for the rest of the year.
- A copay is a fixed amount you must pay for covered services after you’ve paid your deductible. This amount often varies for different services on your plan (e.g., lab tests, prescriptions or primary care visits).
- Coinsurance is the percent of covered health care services you must pay for after you’ve reached your deductible. For example, if you have a doctor’s appointment after reaching your deductible and your coinsurance is 20%, you will have to pay 20% of the cost of your visit.
Mistakes to Avoid
Buying health insurance may be one of your most critical annual purchases. Here are some common mistakes to avoid while purchasing your health insurance plan this year:
- Rushing through enrollment options
- Overlooking policy documents
- Skipping over insurance terms (e.g., copay and coinsurance)
- Trying to hide medical history
- Selecting the wrong plan due to concerns over medical premiums
You’re Not Alone
Finding the right health insurance can be overwhelming. The agents at Insurance Solutions USA are here to help. Contact us in Grapevine, Texas, to learn more about your health coverage options.
This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.