( America. It’s therefore crucial that you choose a plan that safeguards your family’s health while minimizing the danger to your personal finances.
Whereas you’ll typically have limited time to choose a plan, don’t rush into it. Apply the following tips to your decision-making and increase your chances of making the right choice.
1. Choosing a Marketplace
Most Americans will get their health insurance through their employer. If you fall in this segment of the population, you don’t need government marketplaces. Your employer is effectively your marketplace. That said, nothing prevents you from disregarding your employer’s plan and looking for an alternative in other marketplaces. However, you are likely to pay more since you’ll lose out any contribution your employer makes to your health insurance premiums.
If you are self-employed or are in a job with no health insurance, take a look at the plans available in your state’s marketplace (where available) or the federal marketplace to identify the lowest premiums. Enter your ZIP code on and you’ll either use the federal marketplace or be directed to your state’s marketplace.
You can disregard your employer or government marketplaces and buy insurance directly from an insurer. The downside of this private marketplace is you will be ineligible for premium tax credits i.e. discounts on your premiums.
2. Choosing a Plan Type
When shopping for a plan, prepare to be inundated with a flurry of acronyms. It all starts with the type of plan. Plans mainly fall into one of four categories—point of service plan (POS), exclusive provider organization (EPO), preferred provider organization (PPO) and health maintenance organization (HMO). The type of plan you opt for determines the doctors you see and your out-of-pocket costs..
When comparing plan types, pay attention to the summary of benefits each offers. Marketplaces would usually have a prominent link to the summary. There should also be a provider directory listing the clinics and doctors that participate in the network. If you are going for an employer plan, your organization’s benefits administrator should be able to provide you with a summary of benefits.
Of the four major types of plans, none is the automatic choice for family health insurance. The suitability of each varies from household to household. Lay the groundwork by studying your family’s needs. Take a look at your health issues over the last 2-5 years including how much it cost you. While this historical data cannot predict with certainty what your medical expenses will be in future, past trends can give you a more realistic basis to pick a plan.
3. Comparing Networks
The cost of visiting in-network doctors is lower because insurers have already contracted lower rates with them. When you see an out-of-network doctor, pre-agreed rates are non-existent and you are therefore exposed to paying more.
If your family already has one or more preferred doctors you’ve seen for a while and would want to continue doing so, scrutinize the provider directory of the plan to see if they are included. Alternatively, you can ask your preferred doctor whether they accept the health plan you are keen on.
If you don’t have a preferred doctor, then you have more flexibility in your choice. In this case, go with a plan that has a large network. This gives you more doctor alternatives. Larger networks are especially advantageous if you live in a more rural community because it increases your chances of finding an in-network doctor without having to travel too far.
Rule out from your final shortlist any plan that has no local in-network doctors and those with a small number of provider options.
4. Compare Out-of-Pocket Expenses
Out-of-pocket expenses are arguably as big a factor in your decision as the network. Each plan’s summary of benefits should articulate how much you can expect to pay out of pocket. Federal and many state marketplaces provide snapshots of out-of-pocket costs for ease of comparison.
As you do your plan research, you have to familiarize yourself with some such as coinsurance, copayments and deductible. There’s a limit to how much you can spend out of pocket each year and this maximum is listed in each plan’s information.
As a general rule, the lower your plan’s premium, the higher out-of-pocket expenses will be. The ideal plan depends on the state of your health and finances. If you hardly see a doctor and are in excellent shape or if you can’t afford high premiums, the low premiums plan with high out-of-pocket costs is the way to go. If you see a doctor frequently, regularly require emergency care, are expecting a baby, have a surgery coming up or suffer from a chronic condition, then higher monthly premiums with the low out-of-pocket expenses will be best.
5. Compare Benefits
At this point, you should have narrowed down your choices to a few plans. You can trim your shortlist further by examining each plan’s summary of benefits to see if any has a wider scope than the rest. Some plans may have great coverage for mental health or fertility while others may do well with emergency coverage or physical therapy.
This final comparison is important as your goal is to find the plan that’s most suitable for your family’s unique needs. Once you are down to just 2 or 3 options, it’s time to and seek final clarification and reassurance.
Everyone wants the best possible health insurance for their family. Following these tips will increase your chances of picking the most suitable plan from the get-go.