Health insurance serves a few important purposes: it connects you to a network of doctors and hospitals, it helps protect you from certain high medical costs and it allows for peace of mind, whether you’re sick or healthy.
As enrollment approaches this fall, it’s a good time to think about what you hope to get out of your next health insurance policy. And it’s a great time to learn about what health insurance is—and what it isn’t.
To that end, here are some common myths and facts about health insurance.
- Myth: I don’t need health insurance now, I’m healthy.
Fact: No one plans to have an illness or injury. It’s important to have a health insurance policy in place in case you need health care. It’s also helpful to see health care providers when you’re healthy so that they have a baseline—and you have a doctor to call on—when you get sick.
- Myth: I can sign up for health insurance whenever I want.
Fact: There are open enrollment periods and deadlines to sign up for health insurance. With marketplace insurance, such as policies purchased via HealthCare.gov, open enrollment begins November 1 and ends December 15 for coverage beginning in January; and January 15 is the deadline for changes or for policies that begin February 1. To qualify for a “Special Enrollment Period” outside of those dates, you must have a qualifying life event, like losing health coverage, moving, getting married, having a baby, or adopting a child; or you must have had a change to your income that would necessitate a change to your coverage.
For Medicare, open enrollment is October 15 – December 7, and Medicare Advantage open enrollment is January 1 – March 31. If you’re signing up for Medicare for the first time, your initial enrollment period will be based on when you turn 65: it begins three months before you turn 65 and ends three months after the month you turn 65.
- Myth: Health insurance will cover all my health costs.
Fact: You and your health insurance providers are partners in covering your health costs. Your health insurance plan will specify the amounts that it will pay and the amounts that you will pay. Different plans, for example, will have different deductibles, co-pays and co-insurance rates, which will be your financial obligation. Each plan will also have an “out of pocket max,” which is the maximum amount that you will pay in a calendar year. If you reach that, then your plan will cover all eligible costs for the rest of the year.
- Myth: The least expensive health plan is the best way to go.
Fact: Everybody’s needs are different. If you’re young and healthy and don’t anticipate that changing anytime soon, a plan with a low monthly premium might make the most sense for you. However, if you do have health challenges, and/or you’re older and anticipate your medical needs may increase, a plan with a low monthly premium may not be the best choice. In fact, the decision shouldn’t be based solely on the monthly premium; it’s also important to consider the deductible, co-pays, co-insurance and out-of-pocket max, and to make sure that your healthcare providers are in-network. If you look at different marketplace plans by category, for example, you’ll see that Bronze plans have the lowest monthly premium, but the highest costs when care is needed; whereas Platinum plans will have the highest premiums but the lowest cost when care is needed. There’s a lot to consider when choosing a health plan, and many different costs to take into account.
- Myth: Because I have health insurance, I can see any doctor I want and my plan will cover it.
Fact: Your health insurance will have a list of in-network providers that it will cover. If you see a provider who isn’t in the network, your plan may not cover that appointment, or the costs may be higher. In addition, if you have an HMO, you’ll need to get a referral from your primary care physician to see other doctors, such as specialists. If you have a PPO you can schedule appointments with providers and facilities outside of your network and still have those services covered by your insurance, although the costs may be higher than in-network.
Choosing your health insurance plan is an important decision, and it’s not always easy. To learn, read our article about other things to consider as open enrollment approaches.
