How to Choose the Right Health Insurance
Choosing a health insurance policy can be tricky. How do you know which plan is right for you and your dependents? Here’s how to proceed with the process.
1) Start the search
Once you start your search, you’ll discover the plethora of options it will eventually get confusing. At times, insurance companies use different terms yet refer to the same thing. Better brush up your insurance knowledge base by learning about the jargons and terminologies first. Then, once you’ve learned the basics, you need to do the math by starting with your maximum premium budget.
2) Determine a budget
When it comes to premiums, the lowest doesn’t always mean the cheapest. You need to factor in your health expenses other than your monthly expenses.
If you find yourself in the hospital oftentimes a year, then paying the highest premium that you can afford won’t hurt. If you are planning to have a baby or undergo a planned surgery, you may also opt for a higher premium so you can save yourself from hefty out-of-pocket costs. Are you on maintenance? Make sure your medicines are covered. These are anticipated medical needs that must be considered in your choice of a coverage.
For health emergencies, consider a plan with a health savings account feature. You can withdraw this money if someone in the family got sick. After determining an estimate of your would-be monthly premiums, the next step is to search for options and scrutinize each option to find the best fit.
3) Evaluate each network
If you have preferred doctors you want to be included in your plan, determine which networks they belong to first. Then, appraise the networks based on their inclusions and benefits. In this way, you need not compromise your preferences while still finding the right policy for you. This is true whether you are acquiring the coverage through an employer or a private company.
4) Choose a plan
Regardless of which network you choose, there are at least two health insurance plans that you can choose from. The most common, however, is the HMO (health maintenance organization). An HMO covers care provided by the hospitals and doctors within the HMO’s network. The other plan is PPO (preferred provider organization), which covers care provided by medical facilities and doctors inside and outside the insurance provider’s network.
Nonetheless, the costs of out-of-network care provision tend to be higher than the costs of in-network care provision. Whichever you choose, your goal should be choosing the plan that lowers your out-of-pocket costs. Compare the plans on the basis of out-of-pocket costs and covered benefits.
These are pretty much the steps you can take to find the right coverage for you. However, there are additional tips that you must take heed of.
First, don’t overbuy. It would be better to find a provider that takes all your insurances (home, car, etc.). Second, keep yourself abreast of the changes in the insurance industry. For instance, under ObamaCare, employers with more than 50 full-time employees should offer a coverage to about 90% of the workforce. Lastly, review your policies annually. An annual review will do, but a review every time a major change occur such as the purchase of a new car or the birth of your second child is much better.
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