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Choosing a Healthcare Plan
Choosing healthcare isn’t easy because there are so many options available at all different price points. Let us help you figure out how to choose a healthcare plan with these 7 tips.
If you struggle to choose a healthcare plan that’s right for you, you’re not alone. Most Americans have a difficult time understanding the policies they’re browsing, with a whopping 80% of individuals purchasing a plan that takes more out of their pocket annually than alternative options.
So how do you weed through the confusing terminology and make a decision that gives you the right coverage at a fair price?
We’re offering up 7 tips to help you better understand your options and make the best choice available.
Start with a Quick Call to Your Doctor’s Office
This five-minute call will save you a lot of time and headaches. Before you begin browsing healthcare options, call the office of your primary care physician and ask what insurance plans they accept.
A common mistake made by individuals while shopping policies is to assume just because the insurance policy is offered by a well-known insurance company, it will be accepted by their doctor. This is 100 percent inaccurate.
Every healthcare policy has a specific network that it works within, and each healthcare provider is a part of their own list of networks, so it pays to make sure the policies your browsing are among them.
As you make this call, be sure to inquire whether local hospitals and specialists are also included within this network. You can also call your specialists up yourself or ask the policy provider for a list of who is in their network.
Review Your Past Healthcare Expenses
What is it you really need out of a healthcare plan?
It’s imperative you know the answer to this question before you start shopping healthcare options. Policies vary dramatically in deductibles and what they cover, so you need to make sure the ones you are considering align with your specific needs.
- How many times did you visit a doctor last year?
- Did you have to visit any specialists?
- Do you have any medical conditions that require regular doses of medicine, residual treatment, or regular medical visits?
- Are you at risk for any medical emergencies?
- What is your past deductible, and did you ever reach or exceed it?
The ratio of your past deductible versus how much you spent is very important. If you are in great health and never do more than your annual physical each year, you can accept a higher deductible.
However, if you met or exceeded that amount, it’s important to get a policy that reduces your out of pocket expenses as much as possible. After all, a healthcare policy should save you money–not make you spend more!
Know the Difference Between Common Plan Types
Healthcare providers offer various healthcare options, including:
- Health Maintenance Program (HMO)
- Preferred Provider Organizations (PPO)
- Exclusive Provider Organization (EPO)
Educate yourself on the difference. This will help you determine at a glance whether the policies you’re shopping are the kind you really want. Each type has their own pros and cons.
HMO’s have a very restricted network and you’ll need a referral from your primary physician to see any specialists, but in turn you receive a significantly reduced cost for healthcare treatment.
PPO’s have higher premiums than HMO policies, but they have more liberty, too. While in-network physicians and specialists will always be cheaper, you have the option to see medical professionals outside of your network as well. You don’t need to ask your primary physician for referrals, either.
EPO’s are similar to HMO’s, except referrals aren’t necessary if you want to make an appointment to see a specialist. You still have a network you have to stay within, unlike PPO’s.
Know the Difference Between Bronze, Silver, Gold, and Platinum Classes
HMO’s, PPO’s, and EPO’s aren’t the only distinguishing categories for healthcare plans. Policies are also classified under different metal classes to help you distinguish the differences between how much you pay versus how much your provider pays whenever you incur medical expenses.
Here’s how Healthcare.gov breaks it down:
- Bronze policies have you pay 40% while your insurance covers the remaining 60%
- Silver policies have you pay 30% while your insurance covers the remaining 70%
- Gold policies have you pay 20% while your insurance covers the remaining 80%
- Platinum policies have you pay 10% while your insurance covers the remaining 90%
Note that plans fall under both a metal class and a plan type. This is to help you know the gist of how a plan is structured just by the name alone.
Be Clear on How a Deductible Works
Your monthly payment isn’t all that you spend when you have a healthcare policy. There are 3 expenses to consider: your premium, your out-of-pocket expenses, and your deductible.
Deductibles are one of the most important numbers to pay attention to, as it defines how much you will have to pay in healthcare services that are covered in your policy before your insurance company will offer to pay for anything.
Your monthly premium is the amount you pay each month for your policy. This does not go toward your deductible at all. Out-of-pocket maximums are the caps on how much a policyholder can spend a year on healthcare services before your insurance policy covers 100 percent of the expenses.
Pay Attention to Copays and Coinsurance
Copays and coinsurance are both advantageous to policyholders. They reduce the cost of a medical test or appointment by reducing it to a flat fee per visit.
Keep in mind that copays and coinsurance will only kick in after you’ve paid your deductible. This is why we emphasize the importance of deductibles. If yours is high, you may have to spend more than your policy is worth before you begin reaping your insurance benefits.
Don’t Be Afraid to Consult a Healthcare Broker
Lastly, don’t be afraid to consult a medical supplement broker to help you choose a healthcare plan. These individuals are trained in understanding the plans that are available to you. He or she can guide you through the complicated lingo and fine print in order to help you choose the best plan for your budget.
Many people find peace of mind in this, as they have a knowledgeable, licensed professional to answer any questions they may have and help them weigh the pros and cons of the plans available to them.
Now It’s Time to Choose a Healthcare Plan
Now that you know the basics of how to choose a healthcare plan, explore your options and make a confident decision based on your needs and budget.
For more tips on little decisions that can help you make better life choices, make sure you check out our lifestyle articles. From healthy living to general life tips, you’ll find it hard to stop browsing them!