Selecting a health insurance plan is as important as it is complex. There are many health insurance plans to choose from, each with varying levels of coverage, as well as costs. In addition, most providers have several tiers of plans. While the plans may offer identical coverage, how much you pay in deductibles and premiums may be vastly different. Some plans also allow you to extend coverage to family members, while others are only for individuals. There are even more factors, such as whether your current physicians are under the insurance provider’s network.
When looking for affordable health insurance, you must also consider when coverage begins. With certain types of insurance, such as the federally funded Medicaid, you must apply during the open enrollment period. Unless you meet specific stipulations, you have to wait for another eligible period to receive your benefits. Most private insurance companies allow you to purchase insurance whenever you want, but there may still be stipulations on when the coverage begins, such as waiting until the start of the next month.
Understanding Insurance Payments
Part of the difficulty of selecting an affordable insurance plan is all the different types of payments. While researching a plan, it is important you know all the terminology to find the best options. Every insurance plan has a monthly cost, which is known as the premium. Even if you do not use your insurance during the month, you must pay the premium. Your deductible is the total amount you pay out of pocket before your insurance coverage kicks in. Deductibles reset each year. After you reach your deductible, there is another payment, your coinsurance. This is the percentage you must continue to pay for insurance, with the rest of the percentage being covered by your plan.
Another one of the base payments on insurance plans is copayment. Copayments are a fixed amount you must pay for specific services. For example, if your copay for a doctor’s visit is $20, you must pay this fee for each appointment, even if you already paid your deductible.
The final payment is your out-of-pocket maximum. This is the largest amount you can pay out of pocket over the year. If you hit this maximum, your insurance will cover the rest of your medical costs, even if you did not hit your deductible. If your insurance plan allows you to add family members, there may be two maximums, one for you and one for family members. In most cases, your maximum is lower, but this may change depending on the provider.
Levels of Coverage
While cost is an important concern when selecting health insurance, you do not want to overlook the level of coverage. With most plans, the higher the premium, the greater the coverage. Most health insurance plans, whether from the government or a private provider, cover doctor and hospital visits and wellness care. They also assist with prescription drug and medical device costs. Some insurance plans will also include vision and dental coverage, or at least provide an option to pay extra to include these services at a higher tier.
If your plan provides coverage for multiple people, make sure the level of coverage applies to everyone on the plan. For example, some insurance plans will provide dental or vision benefits to the primary insurance holder, but not any family members on the plan. This is especially important if a family member on your insurance plan needs longer term care.
Another consideration with coverage is where you can use your insurance. Many insurance plans only provide coverage when you use a provider in-network. If you go to a doctor or hospital outside of the network, you are responsible for the costs. Some insurance plans do offer limited coverage if you go outside of your network, but it is significantly less than what you get from your network.
Choosing a Tiered Health Insurance Plan
The majority of insurance providers offer multiple plans, divided into separate tiers. If you are purchasing state insurance from the health insurance marketplace, there are four tiers of plans. The tiers are divided into bronze, silver, gold and platinum. With most plans, the lower your monthly premium, the higher all the other costs are. Bronze and silver tiers are recommended if you are on a limited budget or have minimal medical concerns. These plans also have more discounts or tax credits available based on your income level.
Gold and platinum provide more extensive coverage at the cost of a higher premium. However, the other payments tend to be lower to compensate. Many of these plans also include additional coverage for family members.
Private insurance companies also have their own tiers of health insurance. These policies typically provide more customization than state insurance plans, letting you change the level of coverage in exchange for higher rates in other areas. For example, if you remove vision coverage you can get a lower premium.
Cost of Health Insurance Plans
The costs of health insurance plans greatly vary. According to a 2020 study, on average individual health insurance plans cost $450 for individuals or $1,150 for family plans. This is the base cost before any discounts are applied. For example, lower income individuals and families receive significant deductions on federal insurance plans. Other plans are available for discounted or free to seniors or disabled individuals, such as Medicare.
United Healthcare
United Healthcare was always a popular insurance provider, but the company received a wave of new customers during the Covid pandemic. This is due to United Healthcare including access to online care with all of their plans. Online care allows you to speak with medical consultants before making an appointment, letting you know whether your issue was serious or something that would get better with rest or over the counter treatments. If you needed treatment, you could register an appointment with a doctor or specialist within the network. You can also participate in wellness programs and order your prescriptions through the website.
Aetna
As one of the largest insurance providers, Aetna has a huge network. However, the company does not sell private insurance plans. Instead, it is a sponsor for Medicare and Medicaid, as well as employer and student plans. Aetna offers limited coverage outside of the Aetna network. There are also several wellness programs only available to Aetna members.