Health insurance is a vital part of life for many people, but it can be hard to know which plan is right for you. Thus, the following are five different factors you should consider when choosing health insurance to get the best deal possible that suits your needs.
1. Type of Plans
There are four different health insurance plans to choose from that suit you and your loved ones the most. The plans include:
- Indemnity Plans
Indemnity plans offer the most freedom in terms of choosing doctors and hospitals but also have higher deductibles and out-of-pocket costs.
- Managed Care Plans
Managed-care plans usually have lower premiums, but you are limited to a specific network of providers.
- Preferred Provider Organizations (PPOs) Plans
PPOs allow you to see any doctor within the plan’s network but also have a higher deductible than other types of plans.
- Point-of-Service (POS) Plans
POS plans are a mix between PPOs and managed care plans where you can choose either in- or out-of-network providers but typically have lower deductibles than PPOs.
2. Deductibles
Your deductible is the amount of money you have to pay out-of-pocket for your medical expenses before your insurance plan starts to pay. Deductibles can range from a few hundred dollars to a few thousand dollars.
Additionally, some plans require that you meet your deductible before any coverage kicks in, while others may offer some coverage (like preventive care) even before meeting your deductible. So, it’s vital to consider how much you’re willing and able to pay should you need to use your health insurance.
3. Premiums
Your premium is the amount of money you pay every month for your insurance coverage. Premiums can vary greatly depending on the type of plan you choose, the deductible, your age, whether you smoke, and other risk factors. However, it’s essential to remember that cheaper plans may have higher deductibles and out-of-pocket costs, while more expensive plans may have lower deductibles and out-of-pocket costs.
Thus, it’s essential to find a plan that you feel comfortable with financially. Besides, health insurance premiums are tax-deductible if you itemize your deductions on your taxes. Moreover, suppose you can’t afford to pay your premium in full. In that case, many insurance companies offer payment plans to help break the cost down into more manageable monthly payments to fit your financial situation.
4. Coinsurance
Coinsurance is your share of the cost of a covered medical service. It’s usually calculated as a percentage of the allowed amount for the service (for example, 20%). So, if your coinsurance is 20% and an MRI costs $1000, you would pay $200, and your health insurance company would pay the other $800.
Some insurance plans have no coinsurance, some have a fixed amount (like $100), and others may have different percentages for different services. Thus, be sure to inquire about the availability of coinsurance and find the one you are comfortable it that can suit your financial needs.
5. Medicine Cover
Finally, it’s essential to check what type of medicine your health insurance plan covers. Many programs only cover generic drugs, while others cover brand-name drugs. However, some plans offer a more comprehensive range of coverage for both generics and brand-name drugs.
Consequently, it’s essential to know which type of medicines you and your loved ones need and find a plan that covers those drugs. You can usually find this information on the insurance company’s website or by speaking to a customer service representative. Otherwise, choosing the wrong plan that may not cover your medicine may be costly when you need them since you will pay out of the pocket.
