To many people, health insurance is a passing thought. To others, it’s a scary one. Many people find there to be too many confusing and intimidating terms and dread having to choose their health insurance plan. Below, we have prepared five things that can help pick the right health coverage plan.
1. Which insurance plan is right for you.
While searching for health insurance, you’ll encounter the terms HMO, PPO, EPO, and POS. While these terms might sound scary or completely alien, they are just acronyms for what type of health insurance plan they are.
Health Maintenance Organization (HMO).
These plans tend to have lower out-of-pocket costs, a primary doctor, and referrals being required to see a specialist. You also must stay in-network except for emergencies.
Preferred Provider Organization (PPO).
A PPO, preferred provider organization, will give you more provider options and won’t require a referral for a specialist, but typically have higher out-of-pocket costs. You can go out of network, though, typically for a higher price.
Exclusive Provider Organization (EPO).
Much like an HMO, an EPOs have lower out-of-pocket costs. Like a PPO, they won’t require referrals to see a specialist. The negative of this plan is the less freedom when choosing providers and that you must stay in-network except for emergencies.
Point of Service Plan (POS).
With a POS, point of service plan, you have more provider options than any other plan, a primary doctor, and need a referral to see a specialist. Like the PPO plan, you are allowed to go out of network, but the cost will be more expensive.
2. About health insurance networks.
When talking about health insurance networks, we mean the medical providers and hospitals/ urgent care center your health insurance works with to give you coverage.
The reason to consider health coverage networks is that costs will be lowered if you go to an in-network doctor versus an out-of-network one; this is because insurers have contracts with their in-network doctors to provide lower rates to their clients. When looking for which insurance plan to go with, you should consider if you have a preferred doctor or facility and then see if they are in-network.
If you’re not sure or can’t find either when searching, you can also ask your health physician if they are a part of any health coverage plans. Should you not have a preferred physician, then looking for a plan with a large network might be the right choice, as this will give you more options and access to doctors around your area.
3. What a premium is.
The premium in an insurance plan is how much you pay monthly for your health coverage. Premiums payments vary based on coverage and cost-sharing a plan requires. They are paid monthly and can result in the loss of coverage if not paid. Though, remember this is not the deductible and will not include out-of-network costs. You will also be responsible for cost-sharing (co-pay and coinsurance). Check if your insurer has a single or combined deductible for pharmaceuticals and medical services.
Co-pay is a flat fee you must pay for either prescriptions or services.
Coinsurance is a percentage of the cost you must pay for medicine or service.
4. What a deductible is.
Your deductible is the amount you must pay before your insurance begins, and for most non-preventive health care expenses. An example of this is if your deductible is $1500, then most health insurance plans won’t pay expenses unless you have spent $1500 in out-of-pocket expenses. That’s not to say you can’t have a lower deductible, though this would usually entail a higher monthly premium.
5. The coverage of medicines.
When checking health coverage plans, you should check if your health insurance plan covers your regular prescribed medicines. Each insurer has a formulary, a list of medications covered by the plan. If not on the formulary, then it won’t be covered, and patients will have to either pay out of pocket for their medicine or go through a lengthy process to obtain it via the insurer. The formulary can also be divided into tiers determined by how much your co-pay or coinsurance is.