With open enrollment right around the corner, many people will be thinking about selecting a health care plan. You want to get the plan suited best to your needs and your budget. But for many people, it’s hard to predict health changes in the coming year.
Read on for a brief guide on how to choose the right plan for you and your family, whether you’re starting a new job, preparing for open enrollment or entering a new phase in your life that will involve a change in insurance. With a little preparation, it’s not as challenging as you might think.
- Consider the types of health care plans available in Alabama. Those include:
- A group plan offered by an employer.
- A Federal Employee Program offered to government employees.
- A plan through the health insurance marketplace, Healthcare.gov, which is facilitated by the federal government and meets the standards set by the Affordable Care Act (ACA); open enrollment for 2022 plans is November 1 through December 15.
- Short term plans that offer temporary coverage.
- Catastrophic plans for those under 30 or those who qualify for a hardship or affordability exemption.
- Medicare, which is a federal health insurance program available to people 65 and older and for people with certain disabilities; the private insurance options for Medicare recipients are called Part C and Part D.
- Medicaid, which includes a variety of programs for children, families, pregnant women, older adults and disabled people who meet certain income requirements.
- Health insurance plans may use a vocabulary that’s new to you. Learn these key words and phrases when picking a plan:
- Gold vs. Bronze vs. Silver. If you’re choosing a plan from the marketplace, you’ll notice that there are different categories, each named for a metal. These categories correspond with guidelines set by the ACA: Bronze plans cover about 60 percent of costs, Silver plans cover about 70 percent (unless you qualify for a health insurance subsidy) and Gold plans cover about 80 percent of costs, on average; the insured person covered by the plan pays the remaining costs.
- Understand premiums, co-insurance, co-pays and deductibles. These are the portions that you will be responsible for with your insurance, and each number will be listed on the plans you look at. The premium is the set amount that you’ll pay every month to continue your insurance policy. Co-insurance is the percentage of the cost that you will pay for each service (20 percent of a surgery, for example). A co-pay is the fixed amount you’ll pay for each service ($50 to visit a specialist, for example). And the deductible is the amount of money you pay for services before health insurance starts covering them (if your deductible is $1,750, for example you’ll pay for eligible costs for up to $1,750 before your policy begins covering a set portion of services and procedures).
- Know what the out-of-pocket maximum is. This is the highest amount you’ll pay for your health care needs for the year under your policy. It includes all of the payments you make for co-pays, co-insurance and the deductible. If your out-of-pocket maximum is $6,000, for example, then when you’ve paid that amount eligible medical expenses, the insurance policy covers all other eligible expenses for the rest of the plan period, with the exception of the premium.
- Find out who can be covered by your plan.
If your insurance is covered through your employer, then your employer establishes the guidelines on whether or not your household members, such as your spouse and dependent children, can be covered by your health insurance plan. If you’re purchasing health insurance through the marketplace, you can choose to also cover those you’re claiming as dependents on your taxes, such as dependent children, including adopted and foster children; dependent parents; dependent siblings, and other dependent relatives, along with your spouse.
- When making a final decision on an insurance policy, keep in mind these rules of thumb:
- For those who take prescription drugs regularly and see health care providers frequently, a premium plan (such as the Gold plan on the marketplace) may make sense. While the premium payments are higher, the deductibles are lower, and so are co-pays and co-insurance.
- If you only visit health care professionals, every so often, and you don’t want to pay the higher premiums associated with Gold plans, a Silver plan, or something similar offered by your employer may make the most sense.
- If you rarely go to the doctor and you don’t have many needs for prescription drugs now, the Bronze plans, or a more basic plan offered by your employer, will offer the lowest monthly premiums.
If we all had crystal balls and knew what to expect with our health in the coming year, it’d be easy to select a plan. But in absence of that, familiarize yourself with your options, consider your needs and your finances and choose the best plan that fits all of the above for you and your family.