Many U.S. citizens are still risking their health by going without insurance. Although it would make good healthcare more accessible, they simply don’t know which health plan to sign up for.
Fortunately, there are health insurance plans to suit all types of people, from single individuals to families and from college students to senior citizens. This diversity in health insurance options may have contributed to the significant increase in health insurance coverage in 2022, as reported by the United States Census Bureau.
Most often, people are not insured due to uncertainty about the right plan for their budget or medical needs. That’s why we created this guide to selecting the ideal insurance plan for your needs.
The Benefits Of Health Insurance
There are several benefits of health insurance. You’ll enjoy greater access to good healthcare, preventive care that can keep you healthier for longer, and financial protection against unexpected medical emergencies. All of these benefits lead to the greatest one of all – peace of mind.
You cannot overlook the stress of going without medical insurance and the toll a medical emergency can take on the mind and the budget. This very type of stress can make one prone to even more ill health.
By taking control of your and your family’s healthcare needs, you’ll all reap the benefits of happier, healthier lives. So, how do you know which health insurance plan to choose? A quick look at the health insurance market will show that there are so many options that they can become overwhelming.
The secret is to familiarize yourself with the main types of insurance and what they can offer you.
Types Of Health Insurance
The various insurers on the market offer a wide range of health insurance plans. Some of these are tailored for employers who want to provide health coverage to their employees. Others are designed for individuals who need limited health coverage or families who need comprehensive coverage.
These plans will have varying degrees of coverage owing to their unique benefit schedules. Pricing will also differ, which will be tied to the level of coverage offered. But when you do a bit of research, you’ll find that there is a good fit for everyone.
Health Insurance And The Affordable Care Act (ACA)
The Affordable Care Act health reforms of 2010 were signed into law by President Obama and is, therefore, perhaps better known as Obamacare.
Major medical insurance in the U.S. is now subject to the regulations of the ACA. This means the insurers behind these health insurance plans must offer certain essential health benefits and may not discriminate against you based on existing health conditions.
The different types of health insurance plans below, when started since these healthcare reforms were signed into law, now fall under the ACA.
ACA subsidies are available for those who struggle to pay for insurance. Still, eligibility for Obamacare subsidies is determined by income.
Employer-Sponsored Insurance
Many Americans obtain health insurance through their employer. Employer-sponsored health insurance is usually a private health insurance plan designed for employers to offer their groups of employees.
In large companies with 50 or more employees, the employer must, by law, offer a health insurance option. The employer must also pay at least 60% of the premiums.
Employees’ contributions are capped by law. Their monthly premiums may not exceed 9,78% of their household’s income.
Employer-sponsored insurance may be for individuals only or include their spouses and families.
Private Insurance For Individuals And Family
Individual health insurance covers a single person. You pay a set monthly amount, known as a premium, and your medical expenses will be covered to a certain degree. The specific type of plan you’re on and the premium you pay affect what your insurance covers and what you’ll pay out-of-pocket.
Family health insurance can cover family members under one plan. This means that you can still pay one premium, and all the members of your household will enjoy health insurance coverage. Once again, the level of coverage you have and your out-of-pocket expenses vary with each plan.
Health Maintenance Organization (HMO)
You (or sometimes your insurer) will choose a primary care physician. This primary doctor must refer you to other medical specialists and facilities contracted to the insurer through a network. Although restrictive, HMO plans often have lower premiums.
Exclusive Provider Organization (EPO)
Like an HMO, an EPO limits you to a network of medical providers but contracted to the insurer. Unlike the HMO, you won’t need a referral before seeing a specialist. It’s usually more expensive than an HMO, and visits to medical providers outside of the network won’t be covered.
Preferred Provider Organization (PPO)
A Preferred Provider Organization plan allows you to use your chosen healthcare providers. However, there is still a network of providers contracted to the insurer. Using this preferred network will be more affordable. PPOs are usually more expensive than EPOs.
Point Of Service (POS)
This is a hybrid of the HMO and PPO plans. With Point Of Service plans, you’ll choose a primary care physician for referrals, like in an HMO. But, like in a PPO, you can use healthcare providers outside the network. Doing so will increase your out-of-pocket costs, though.
Catastrophic Health Insurance (High Deductible) Plan
Catastrophic health insurance is health coverage designed to provide financial protection against unexpected and severe medical expenses and for preventative care.
This insurance is primarily intended for individuals who are relatively healthy and do not require frequent medical care but want to safeguard themselves from the financial devastation that can result from a major medical event, such as a serious illness or injury.
Catastrophic health plans typically come with low monthly premiums and a high deductible.
Federal And State-Run Programs
Medicaid
Medicaid is a federal and state-run program that covers the healthcare costs of eligible people with low or no income. Millions of U.S. citizens access health coverage with this program. Medicaid also assists pregnant women, people with disabilities, and older adults.
While a small copayment is sometimes required, most healthcare services carry no charge. Financial criteria will determine your eligibility and total household income (for married couples or families).
Medicare
Like Medicaid, Medicare is a federally sponsored health insurance program. But it is targeted at a different audience. Medicare assists people over 65, people with specific disabilities, and people with end-stage renal disease (ESRD), which causes permanent kidney failure.
Medicare is divided into Parts A, B, C, and D.
- Part A covers in-patient hospital stay costs, limited nursing home costs, and hospice care. No premium is payable if you or your spouse paid qualifying taxes while employed. Alternatively, a premium will be calculated based on your tax-paying history.
- Part B carries a monthly premium but covers everyday health care expenses. These include doctor’s office visits, general check-ups, outpatient surgeries, emergency services, specific medical supplies, and preventive healthcare.
- Part C, also known as Medicare Advantage, is offered by Medicare-approved private insurers as an alternative to Parts A and B. They have the same benefits as Parts A and B, and sometimes Part D. Additional vision dental benefits are often included. Premiums vary between insurers, and small copayment or coinsurance costs may apply.
- Part D covers prescription drug costs. There are monthly premiums, but these can be deducted directly from your Social Security (if you choose). You must reach a yearly deductible and pay a copayment or coinsurance percentage afterward. The government assists those who have minimal incomes.
What To Consider When Choosing Health Insurance
These factors play a significant role when considering which health insurance plan to choose.
Changing Needs
Understand that your healthcare needs, and therefore your health insurance needs, will change throughout your life.
Take the following criteria into account:
- age
- overall health
- chronic illnesses or injuries
- marital status and dependents
Financial Situation
This is especially true if your family depends on you financially. Choose a plan with premiums you can afford without hampering your quality of life.
Evaluate Network Coverage
Exclusive or preferred provider networks can help you to save money on premiums and out-of-pocket costs like copayments and coinsurance. They may also have lower deductibles. Will you be happy with the limitations placed by exclusive networks?
Covered Drug Lists
The prescription drugs covered by each policy can differ. Check the covered drug lists to see if what is covered suits your situation, especially if you have a chronic illness.
You may face extra costs out-of-pocket if you use medications that aren’t on the list.
Analyze Cost-Sharing
The co-payments, coinsurance, and deductibles you’ll face can vary dramatically from one type of insurance and one insurance company to the next. Be sure that you understand how these cost-sharing expenses will affect your budget.
Review Plan Options
What works for your neighbor or friend may not necessarily work for you. Which type of ACA insurance plan best meets your needs? Are you eligible for one of the federal programs like Medicaid or Medicare?
Seek Expert Advice
If you are still determining which plan can work for you, seek help. A financial advisor, healthcare expert, or health insurance broker like Enhance Health can provide guidance based on your circumstances.
Conclusion
As you’ll have discovered in this concise guide to insurance plans, higher coverage and more freedom in choosing your healthcare providers usually cost more. Therefore, selecting the ideal insurance plan often rests on your budget.
As a qualified ACA insurance broker, we can help you select the right plan for your medical and financial circumstances. Contact us today for assistance with choosing the ideal insurance plan for you.
