In 2017, the total number of Americans without health insurance was over 12% of the population.
While the number of uninsured Americans grows, health care costs are also rising. That means that millions of Americans may not be able to cover their costs in the case of a medical emergency.
But shopping for health insurance isn’t cut and dry. Amidst all of the plans, networks, premiums, and acronyms, you’re probably asking yourself ‘what health insurance should I get?’
We’re here to help. Keep reading for everything you need to know about health insurance and how to pick one that’s right for you.
Group vs Individual Plans
There are two main categories of health insurance: group coverage and individual coverage. Group plans are provided by the place where you work and individual plans are sought independently of an employer. We’ll explain each in more detail below.
Group Insurance Plans
A group plan is usually provided by your employer. Employer group plans are provided by private employers, government agencies, and/or worker’s unions. This is the form of health insurance that covers the majority of Americans.
In a group insurance plan, your employer pays a portion of your premiums. This is why group insurance plans are the least expensive option.
In addition, group insurance plans offer more comprehensive coverage than individual plans. Under an employer plan, you’re more likely to be covered for maternity care, preventative care, vision, and even dental care.
Individual Insurance Plans
You can supplement your employer group plan if you wish. Or, in the case your employer doesn’t offer health insurance, it’s wise to purchase health insurance for yourself. In either case, you can purchase individual insurance in the government insurance exchanges or marketplaces.
With an individual insurance plan, you negotiate and purchase a plan from an insurer. To learn more about creating a custom individual insurance plan, you can visit this page.
Also known as a single-payer plan, these tend to cost a lot more than group plans because you’re responsible for all of the payments. They also tend to provide more limited coverage than group plans.
To purchase group insurance from the open market, you can start your search on your state’s Affordable Care Act marketplace. If that’s not available in your state, you can check the federal marketplace – that’s also where you’ll find the lowest premiums.
Alternatively, you can purchase individual health insurance through a private exchange or directly from an insurance company. Keep in mind that you don’t receive premium subsidies if you purchase your insurance this way. These subsidies are income-based discounts that can save you some money every month.
The most common types of health insurance plans are HMO, EPO, POS, and PPO plans. The acronyms can certainly get confusing, but essentially, these tell you what your out of pocket costs consist of and which doctors you can visit for care. Keep reading to learn about the benefits of each.
HMO: Health Maintenance Organization
With an HMO plan, you’re only covered within your own network. In the case of an emergency, you’re permitted to go outside of your network. And if you need to see a specialist or you require a procedure, you’ll have to get a referral from your GP first.
HMO’s often have low out-of-pocket costs that fit most budgets. The other benefit is that your doctor coordinates specialists, tests, and other care on your behalf. If you’re not the most organized, this might be a good option for you.
POS: Point of Service Plan
Although it’s the less expensive option, you don’t have to stay in your network for coverage with a POS plan. But you still need a referral when you require a procedure or a specialist.
Like an HMO plan, POS is a good choice when you don’t mind your doctor coordinating all aspects of your care. However, the main benefit of a POS over an HMO plan is that it offers you a wider range of options when it comes to providers.
PPO: Preferred Provider Organization
Because HMO and POS plans require referrals for specialists and procedures, many people don’t favor them. Although they offer lower out-of-pocket costs, being required to see your primary care physician for referrals is why some people choose a PPO instead.
In a PPO plan, you can go outside of your network for coverage and you’re not required to see your primary care physician for procedures and referrals. This plan gives you a wide range of provider options, which is great for people living in rural or remote areas who often have to go outside their network.
EPO: Exclusive Provider Organization
Like an HMO, you have to stay within the EPO network except in emergency situations. But EPOs allow you to see specialists and schedule procedures without a referral from your primary physician.
EPOs have relatively low costs as long as you find providers within your network. They also let you choose your own physicians.
Picking Your Network
To figure out what doctors and clinics are available in a plan’s network, look for the provider directory. This will list all participants in the organization so you can plan accordingly.
If you have physicians that you want to continue seeing for care, check the provider directory to see if you’ll be covered. Alternatively, you can ask your doctors what health plans they accept.
If you’re not picky about where you get treatment, you’ll still want to choose a plan with a large network. A large network gives you more options for treatment which is especially important for people living outside of large cities.
Cost-sharing is a feature of all health insurance plans, regardless of where you purchase it or what the particular terms are. The most common cost-sharing methods are deductibles, coinsurance, and copayments.
- A copayment is a flat fee that you pay whenever you receive medical treatment or service. Fees for emergency room visits, specialist visits, and various procedures, are fixed amounts. Your insurer pays the remainder of the amount.
- Coinsurance payment is when you pay a percentage of the total cost for medical treatment or service. Typically, you pay a deductible before your insurance pays any amount.
- A deductible is an amount you have to pay out of your own pocket before your insurer begins to pay. This expense ceiling is a preset amount paid by you and, once you’ve reached that ceiling, a percentage of the remainder is covered under your insurance plan.
Your premium is another aspect of the cost you’ll want to understand. Premiums refer to the amount you pay monthly to keep your insurance policy active, regardless of whether or not you receive medical care that month.
To determine the costs of any particular plan, look for a summary of benefits. This will tell you exactly what you pay for out of pocket services.
The Minimum Requirements
The Patient Protection and Affordable Care Act (PPACA) was enacted in March 2010. Its intention was to improve access to quality healthcare for you and your family. As such, it stipulated that all health insurance plans were henceforth required to offer “essential benefits”.
The minimum benefits set out by the PPACA include:
- Emergency services
- Pregnancy, maternity, and newborn care
- Laboratory services
- Prescription drugs
- Hospitalization (including surgery and overnight stays)
- Preventive and wellness services
- Chronic disease management
- Pediatric services, including oral and vision care *for children only)
- Ambulatory services
- Mental health services (including counseling and psychotherapy)
- Substance use disorder services (including counseling and psychotherapy)
- Rehabilitation services and devices
Another important part of the PPACA is the elimination of pre-existing condition clauses. These clauses limited the rights of Americans to access health care based on prior medical conditions. Today, health insurers cannot restrict an individual from getting health insurance based on your current health.
At the very least, when buying a health insurance plan, make sure these benefits are available to you. After you’re sure that the minimum requirements are being met, you can look for additional benefits such as critical illness insurance, accident coverage, and lost income protections.
What Health Insurance Should I Get?
Answering the question “what health insurance should I get?” involves choosing your marketplace and picking a network that suits your preferences when it comes to doctors and out-of-pocket costs. You’ll also want to consider how you want to pay and what your budget is, as well as what additional benefits you might need.
Health is more than just a trend. Check out our blog and learn more ways to hack your health and your life.