Each year during late fall, Americans experience the open enrollment period – a timeframe where users buy, compare, and change their health insurance plans. But why is it so important? New plans are introduced every year, and it’s always possible to find a plan that suits your needs at a low cost. However, comparing plans may not be easy. But don’t worry. Here’s the complete guide on choosing a health insurance plan.
Compare Plan Networks
Firstly, you must know there are various plan network options, and each of them varies in terms of providers’ networks. Let’s discover the main types.
HMO plans only cover providers and specialists who work within that specific plan. Unless there’s an emergency, HMO plans won’t pay if you seek medical care from providers outside your plan network. Fortunately, HMO plans are light on your pockets since the out-of-pocket expenses are low.
However, there is very little flexibility since HMOs are restricted to a specific geographic region, and you can only see specific doctors.
PPO plans are different from HMOs. Within a PPO plan, you get a reasonable selection of healthcare providers. Moreover, PPOs even provide coverage for doctors outside your plan network, but you usually pay higher costs than you would pay by seeing an in-network plan. Due to greater flexibility, PPO plans can be expensive.
It’s much like an HMO where you get coverage only if you see in-network doctors. Fortunately, you don’t require a primary care physician (PCP) referral to see a specialist. With EPOs, you have the flexibility to see any specialists within your network without getting a referral.
POs combine features of both HMO and PPO. Here’s how:
· You have more provider options, and you get little coverage if you see an out-network specialist.
· You need your PCP referral to see specialists.
Compare Metal tiers
Once you choose your plan network, you have to decide on the metal tier – different ranks with various premiums and out-of-pocket costs. Generally, there are four metal tiers, including bronze, silver, gold, and platinum.
The bronze plan usually has the lowest premium but high deductibles and out-of-pocket costs. This trend reverses as you go higher up the tier. For example, a gold tier will have the highest premium with little out-of-pocket costs.
Fortunately, all plan types offer some types of preventive care or discounted health care services before you meet the amount of your deductible. Moreover, if you have a silver tier plan, you can lower your costs by applying for cost-sharing reductions. If you qualify, the premiums will be lower.
Comparing Total Costs
It’s not the premium you must consider. Instead, there are various other out-of-pocket costs involved, including:
· Deductible: It’s the amount you must meet before your insurance company starts covering your expenses
· Copays: These are set amounts you pay for any doctor visits
· Coinsurance: It’s the percentage of health care services you must pay for once meeting your deductible
· Out-of-pocket maximum: it’s the annual limit of what you should pay on your own. Once you reach the max, your insurance company usually bears 100% of the cost.
Saving Money on Health Insurance
With facilities like the HDHP plan, you can even save money using health insurance. High deductible health plans have high overall out-of-pocket costs and low premiums. According to the IRS, an HDHP is one with at least $1400 and $2800 deductibles for individual and family plans, respectively. But how can you save money with them?
You can combine an HDHP plan with a Health savings account (HSA), enabling you to set tax-free money aside to help you pay for qualified tax expenses. You can almost contribute up to $3650 for individual coverage and $7300 for family coverage in an HSA. Fortunately, the money rolls over if you don’t use it, and it grows tax-free in the HSA account.
Here you have it: the complete guide to choosing a health insurance plan. But are you wondering where you can find the quotes to compare them? Reach out to New Health Insurance to get free quotes from top lenders and choose the best one for yourself.