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Selecting the Right Health Insurance Plan in Five Easy Steps

Published on April 17, 2024

Selecting the ideal health insurance plan for you and your family.

When it comes to buying insurance, there are a multitude of factors to take into account. These include the marketplace, total costs, plan type, and network, among others. Keep in mind that when shopping for coverage, there are often time constraints (open enrollment periods). However, be cautious when making a decision as selecting an unsuitable plan can result in significant costs. Here are key considerations when shopping for insurance.

First, to get started, decide where you will purchase insurance: through your employer, the marketplace or with a licensed agent.

If your employer offers health insurance:

If your employer offers health insurance, you don’t need to use government insurance exchanges unless you want to explore alternative plans or need coverage for your family. However, marketplace plans may cost more than employer-offered plans because most employers cover a portion of workers’ insurance premiums.

If your employer doesn’t offer health insurance:

Thanks to the Affordable Care Act, health insurance is now accessible to all. When it comes to navigating the marketplace, there are two options available to you. You can either opt for a DIY approach by going to, or you can seek the assistance of a professional, licensed agent. Premium Tax Credits can be used with either option, and are calculated based on key factors such as your age, income, tax filing status, and zip code.

Second, it’s essential to comprehend and distinguish between various types of insurance plans.

Health insurance terminology can be a bit of a maze, but don’t sweat it. The main contenders are HMOs and PPOs plans. What you end up picking will influence your wallet and which doctors you can book. So, let’s compare these health insurance heavyweights: HMO vs. PPO.

Understanding HMOs

Are you unfamiliar with HMOs? Let’s break it down. HMO stands for “Health Maintenance Organization”. HMO plans establish a network of doctors and hospitals that work together to offer medical care in a specific area at a lower cost, while maintaining high quality standards. To receive services from an HMO, you must choose a primary care physician (PCP) and typically require a referral from your PCP to see a specialist or receive certain tests. If you opt to receive medical care outside of an HMO’s network, the plan will not cover those expenses, and you will be responsible for all charges.

Understanding PPOs

PPO refers to a “Preferred Provider Organization.” With PPO plans, you’ll have more flexibility in your choice of doctors or hospitals. While these plans maintain a provider network, you’ll find fewer restrictions on selecting your preferred providers. Unlike HMOs, PPO plans don’t require you to designate a primary care physician (PCP), allowing you to access a wider range of providers.

To evaluate expenses and policy coverage, find a summary of benefits plan. Additionally, take a look at the provider directory to determine which doctors, hospitals, and pharmacies are included in the coverage.

Assess not only your personal medical needs but also those of your family. Consider if you prefer obtaining referrals to see specialists or undergo medical procedures. Are you open to choosing a higher cost plan that includes a health savings account?

Thirdly, carefully analyze the health plan networks.

The medical professionals and facilities that your health plan has partnered with to provide care are known as your health insurance “network.” By staying “in-network,” you can reduce your medical expenses significantly.

Fourth, analyze out-of-pocket expenses.

“Out-of-pocket expenses” refer to any expenses incurred beyond your premium payment.

Feeling lost in the world of insurance lingo?

  • Copay is a fixed fee, like $20, that a patient pays for each healthcare service or procedure.
  • Coinsurance refers to the percentage of a medical charge (e.g., 20%) that you pay, while the remaining cost is covered by your health insurance plan.
  • Deductible is the amount you pay for medical care before your insurance coverage begins.
  • Out-of-pocket maximum is the maximum amount you will pay for covered healthcare in a year, after which your insurance covers the remaining costs.
  • Out-of-pocket costs include copays, coinsurance, and deductibles, which are expenses on top of a plan’s premium.
  • Premium refers to the monthly payment made for a health insurance plan.

*Higher premiums generally result in lower out-of-pocket expenses, whereas lower premiums result in higher out-of-pocket expenses.

Lastly, review plan benefits.

At this point, you should have narrowed down your plan choices to just a few. To determine which health plan is right for you, revisit the summary of benefits and compare the scope of services offered. Pay particular attention to coverage for services such as physical therapy, fertility treatments, mental health care, and emergency situations. You may find that some plans offer more extensive coverage in these areas than others.

You’ve made the ultimate choice for you and your loved ones!

So, what’s up next? Time to enroll.

If you missed the open enrollment window, no sweat. There’s still hope! You may qualify for enrollment if you’ve experienced certain life events.

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