Choosing a Health Insurance Plan 5 Step-by-Step Instructions.

Time is usually limited when it comes to selecting the best health insurance plan for your family, but rushing and selecting the wrong one can be costly. Here’s a step-by-step guide to selecting the best plan for you and your family, whether through the federal marketplace or through an employer.

Step 1: Select a health insurance marketplace.

The majority of people who have health insurance do so through their employer. If you fall into this category, you will not need to use the government’s insurance exchanges or marketplaces. In essence, your company is your market.

If your employer provides health insurance and you want to look for a different plan in the exchanges, you can. However, plans on the market are likely to be much more expensive. This is due to the fact that most employers pay a portion of their employees’ insurance premiums, and the plans have lower total premiums on average.

If your job does not provide health insurance, look for the lowest premiums on your state’s public marketplace, if one exists, or on the federal marketplace. During open enrollment, go to HealthCare.gov and enter your ZIP code. You’ll be directed to your state’s exchange if one exists. You’ll use the federal marketplace if you don’t.

You can also buy health insurance directly from an insurer or through a private exchange. You will not be eligible for premium tax credits, which are income-based discounts on your monthly premiums if you choose these options.

Step 2: Compare various types of health insurance policies.

While shopping, you will come across some alphabet soup; the most common types of health insurance policies are HMOs, PPOs, EPOs, or POS plans. The type you select will influence your out-of-pocket costs and the doctors you can see.

When comparing plans, look for a benefits summary. Online marketplaces typically include a link to the summary as well as the price near the plan’s title. A provider directory, which lists the doctors and clinics in the network of the plan, should also be available. If you’re going through your employer, request a summary of benefits from your workplace benefits administrator.

When comparing different plans, consider your family’s medical needs. Examine the amount and type of treatment you’ve previously received. Though it is impossible to predict every medical expense, being aware of trends can assist you in making an informed decision.

If you choose an HMO or POS plan that requires referrals, you must usually see a primary care physician first before scheduling a procedure or seeing a specialist. Many people prefer other plans because of this requirement. However, because of the restrictions, HMOs are generally the least expensive type of health plan.

If you don’t mind your primary doctor selecting specialists for you, POS and HMO plans may be better. One advantage is that you will have less work to do because your doctor’s staff will coordinate visits and handle medical records. If you choose a POS plan and go out of network, get a referral from your doctor ahead of time to reduce out-of-pocket costs.

If you prefer to select your own specialists, you might prefer a PPO or an EPO. An EPO may help keep costs low as long as providers are in-network; this is more likely in a larger metro area. If you live in a remote or rural area with limited access to doctors and care, a PPO may be preferable, as you may be forced to go outside of the network.

What about a high-deductible health Insurance plan with a health savings account?

A high-deductible health plan can be any of the above types — HMO, PPO, EPO, or POS — but must adhere to certain guidelines in order to be “HSA-eligible.” These HDHPs typically have lower premiums, but you pay more out-of-pocket expenses, particularly at first. They are the only plans that allow you to open an HSA, which is a tax-advantaged account that you can use to pay for healthcare expenses. If you’re interested in this arrangement, make sure you understand the differences between HSAs and HDHPs first.

Step 3: Examine healthcare network options.

When you visit an in-network doctor, your costs are lower because insurance companies negotiate lower rates with in-network providers. When you go out of network, the doctors don’t have agreed-upon rates, so you’re usually on the hook for a larger portion of the bill.

If you have preferred doctors and want to continue seeing them, make sure they are listed in the provider directories for the plan you’re thinking about joining. You can also directly ask your doctors if they participate in a specific health plan.

If you don’t have a favorite doctor, look for a plan with a large network to give you more options. A larger network is especially important if you live in a rural area, as you will be more likely to find a local doctor who accepts your insurance.

If possible, eliminate any plans that do not have local in-network doctors and those that have very few provider options in comparison to other plans.

Step 4: Evaluate your out-of-pocket expenses for Health Insurance.

Out-of-pocket expenses are nearly as important as network costs. The summary of benefits for any plan should clearly state how much you’ll have to pay out of pocket for services. The federal marketplace website, as well as many state marketplaces, provide snapshots of these costs for comparison.

This is where knowing a few health insurance vocabulary words comes in handy. Your share of the costs as a consumer consists of deductibles, copayments, and coinsurance. The total amount you can spend out of pocket in a year is limited, and this amount is also listed in your plan information. The lower your premium, in general, the higher your out-of-pocket costs.

The goal of this step is to narrow down options based on out-of-pocket expenses. A plan that pays a higher percentage of your medical costs but has higher monthly premiums may be preferable if:

  • You see a primary care physician or a specialist on a regular basis.
  • You are frequently in need of emergency care.
  • You regularly take expensive or brand-name medications.
  • You are expecting a child, intend to have a child, or have small children.
  • You’re going to have surgery soon.
  • You’ve been diagnosed with a long-term illness, such as diabetes or cancer.
  • A plan with higher out-of-pocket costs but lower monthly premiums may be a better option if:
  • You simply cannot afford the higher monthly premiums for a plan with lower out-of-pocket expenses.
  • You’re in good health and don’t need to see a doctor very often.

Step 5: Evaluate the advantages of Health Insurance plan.

You’ve probably narrowed your options down to a few by now. To narrow things down even further, go back to the summary of benefits and see if any of the plans cover a broader range of services. Some may have better coverage for physical therapy, fertility treatments, or mental health care, whereas others may have better emergency coverage.

If you skip this quick but important step, you may miss out on a much better plan for yourself and your family.

Once you’ve narrowed your choices down to a couple, it’s time to answer any remaining questions. In some cases, speaking with a person is all that is required, so it may be time to contact the plans’ customer service lines. Prepare your questions in advance, and keep a pen or computer nearby to record the answers.

  • Here are some questions you could ask:
  • I take a specific medication. How does this plan address that?
  • Which medications for my condition are covered by this plan?
  • What maternity services are available?
  • What if I get sick while travelling abroad?
  • How do I begin signing up, and what documents will I require?
  • Finally, don’t forget to cancel your old plan, if you have one, before starting the new one.

Choosing a Health Insurance Plan Checklist

Here’s a quick rundown of the preceding steps:

  • Go to your marketplace and compare your plan options.
  • Determine whether an HMO, PPO, EPO, or POS plan is best for you and your family, as well as whether you want an HSA-eligible plan.
  • Plans that exclude your doctor or any local doctors from the provider network should be avoided.
  • Choose whether you want more health coverage with higher premiums or lower premiums with higher out-of-pocket costs.
  • Make certain that any plan you select will cover your regular and necessary care, such as prescriptions and specialists.

Faq related to buying Health Insurance:-

What is Health Insurance? 

The term health insurance is a type of insurance that covers your medical expenses. A health insurance policy is a contract between an insurer and an individual /group in which the insurer agrees to provide specified health insurance cover at a particular “premium”.

Why is Health Insurance important?

All of us should buy health insurance and for all members of our family, according to our needs. Buying health insurance protects us from the sudden, unexpected costs of hospitalization (or other covered health events, like critical illnesses) which would otherwise make a major dent into household savings or even lead to indebtedness. Each of us is exposed to various health hazards and a medical emergency can strike anyone of us without any prior warning. Healthcare is increasingly expensive, with technological advances, new procedures, and more effective medicines that have also driven up the costs of healthcare. While these high treatment expenses may be beyond the reach of many, taking the security of health insurance is much more affordable.

What are the factors that affect Health Insurance premiums?

Age is a major factor that determines the premium, the older you are the premium cost will be higher because you are more prone to illnesses. Previous medical history is another major factor that determines the premium. If no prior medical history exists, the premium will automatically be lower.  Claim-free years can also be a factor in determining the cost of the premium as it might benefit you with a certain percentage of the discount. This will automatically help you reduce your premium.

What does a Health Insurance policy not cover?

You must read the prospectus/ policy and understand what is not covered under it. Generally, pre-existing diseases (read the policy to understand what a pre-existing disease is defined as) are excluded under a Health Insurance policy. Further, the policy would generally exclude certain diseases from the first year of coverage and also impose a waiting period. There would also be certain standard exclusions such as cost of spectacles, contact lenses and hearing aids not being covered, dental treatment/surgery ( unless requiring hospitalization) not being covered, convalescence, general debility, congenital external defects, venereal disease, intentional self-injury, use of intoxicating drugs/alcohol, AIDS, expenses for diagnosis, x-ray or laboratory tests not consistent with the disease requiring hospitalization, treatment relating to pregnancy or childbirth including cesarean section, Naturopathy treatment.

Is there any Waiting Period for claims under a policy?

Yes. When you get a new policy, generally, there will be a 30 day waiting period starting from the policy inception date, during which period any hospitalization charges will not be payable by the insurance companies. However, this is not applicable to any emergency hospitalization occurring due to an accident. This waiting period will not be applicable for subsequent policies under renewal.

What is a pre-existing condition in a health insurance policy?

It is a medical condition/disease that existed before you obtained a health insurance policy, and it is significant because the insurance companies do not cover such pre-existing conditions, within 48 months prior to the 1st policy.  It means pre-existing conditions can be considered for payment after the completion of 48 months of continuous insurance cover.

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