5 Things to Consider When Choosing Your Health Coverage
Choosing a health insurance plan can feel like an overwhelming task. Here are five things to keep in mind when choosing health coverage for you and your family. For specific information on plan components, see your plan’s Summary of Benefits and Coverage (available from an insurance company), call the insurer directly or visit the insurer’s website.
1. Type of Plan and Provider Network
Do the health care providers, hospitals and pharmacies you prefer fall within the plan’s network?
It’s important to remember that in-network services and medicines are covered under a plan, while out-of-network services and medicines may require additional out-of-pocket costs or may not be covered at all. Importantly, out-of-pocket costs for out-of-network services may not count toward a plan’s out-of-pocket maximum. Check to see if your preferred primary care or specialist provider and the pharmacy near your home are included in the plan’s network.
How much will you pay per month for coverage?
Premiums are the amount you pay an insurance company for coverage, whether or not you use medical and pharmacy services. Premiums are usually paid monthly, and if you stop making payments, you are at risk of losing your coverage. Keep in mind that these are not the only costs associated with coverage. You will also be responsible for paying deductibles and for cost sharing, for example, co-pays and coinsurance, for most health care services and treatments. (See descriptions below)
What is the amount you must pay out of pocket before your coverage kicks in?
For example, if your deductible is $1,000, your health plan won’t pay most expenses until you’ve spent $1,000 on expenses out of pocket. Out-of-pocket costs may include specialist visits, procedure fees, and in some cases even prescriptions. Certain preventive services, such as approved cancer screenings and vaccines, are typically covered with no cost sharing before you reach your deductible. Patients who select a plan with a high deductibles will most likely have a lower monthly premium, while lower deductibles often have higher monthly premiums. Insurers increasingly require a deductible to be met before covering most medical or pharmacy services. Be sure to check with your insurer to know if your plan has either a single, combined deductible for medical and pharmacy services or a separate deductible for prescriptions to know how much you’ll have to pay before medicines are covered.
4. Co-pay or Coinsurance
Are you aware of other costs that you may be required to pay to access care?
Don’t forget you may be responsible for other out-of-pocket expenses even after you reach your deductible. These can include:
• Coinsurance - a percentage of costs you must pay for a medicine or service, or
• Co-pay - flat fees you are required to pay for prescriptions or covered services (often listed on the back of your insurance card)
5. Coverage of Medicines
Are your regular prescriptions covered by your insurance plan?
Each insurer has a formulary (list of medicines) covered by the plan. If a medicine is not on the formulary, it may not be covered, and patients will then have to go through a potentially lengthy process to obtain coverage. The list of covered medicines is also divided into tiers, which determine how much of a co-pay or coinsurance you may have to pay. Make a list of your current medicines, and compare it to the plan’s formulary to make sure your medicines are covered and you understand the out-of-pocket costs that may be associated with them.