4 Tips for Choosing Your Health Benefits
August 17, 2021
Being your own boss means that you’re in charge of picking out your benefits plan. Feeling overwhelmed and confused by shopping for health benefits? We totally get it. Here are 4 tips that will help you to evaluate your options and to pick the best plan for you.
1. Get to Know the Key Terms of Insurance
Let’s start with the vocab. Reading an insurance plan can make you feel like you need a law degree. But knowing these key terms you should know that will help you understand what different health care plan options have to offer.
- Metal Tiers: Under the Affordable Care Act (“ACA” or “Obamacare”), health insurance is presented in four “metal” tiers: Bronze, Silver, Gold, and Platinum based on how the insurance company splits health care costs with you.
- Premium: The amount you pay for health insurance each month.
- Deductible: The cost for health services that you pay before your plan pays anything After you reach this amount, the insurance company pays for 100% of covered services. (Plans with lower monthly premiums typically have higher deductibles; these are known as “catastrophic” coverage plans.)
- Co-Payment: a flat rate fee you pay each time you receive a medical service after reaching your deductible. Co-payments can vary depending on the health service sought — generalists, specialists, and even pharmaceuticals all can have different co-payment amounts.
- Co-Insurance: the amount of the cost you might owe for covered services and prescriptions after you’ve met your deductible (Plans with lower monthly premiums typically have higher coinsurance plans.)
- Out-of-Pocket Maximum: The most you have to spend for covered services in a year. For the 2021 plan year, the out-of-pocket cap for plans sold through the public exchange can’t exceed $8,550 for individuals or $17,100 for families. If you’re purchasing off of the exchange, be sure to check for an out-of-pocket maximum.
Understanding terms will help you to evaluate the financial pros and cons of each plan and more accurately estimate your total annual cost of health care. It will also help you better prepare for potential “what if” scenarios.
2. Think of Your Health Benefits as an Investment in You
Most of us know that we need health insurance for those “just in case” scenarios or to avoid tax penalties for being uninsured (especially for residents of Massachusetts, New Jersey, California, Rhode Island, and the District of Columbia). However, we want you to think of health benefits as an investment in your wellness and quality of life.
Some upfront investment in prevention can not only save you money in the long run. It can also save your life. Some basic preventive services and well-visits are typically free like annual flu shots. Beyond this list, the health benefit plan that you choose can impact the costs of accessing routine care and routine care.
In practical terms, what this means is don’t just look at the monthly premium costs and pick a plan that has the lowest upfront costs. Look also at the deductible, co-pays, and co-insurance requirements. Will the out-of-pocket costs deter you from getting routine or preventive care? Ultimately, the best plan for you depends on your health goals and your monthly budget. What we’re saying is don’t just have health insurance for the sake of having health insurance.
Think of your health insurance plan like a gym membership, or better yet, your favorite streaming subscription services — why don’t you start reaping the benefit of the services on which you’re making a monthly spend? Then, think about your health and wellness goals. Pick a plan that makes it easy for you to take advantage of the services included in your health care plan. Proactively use them to improve your quality of life.
3. Look into the Plan’s Provider Network
A provider network is a list of the doctors, other health care providers, and hospitals that a health care plan has contracted with to provide medical care to its members. Most health insurance companies have a tool where you can search to see whether your health care provider is in-network. If your health care provider hasn’t contracted with the plan, they are considered an “out-of-network” provider. Ideally, choose a plan where your “go-to” health care providers are “in-network.” Why? depending on your plan, your care may be covered only when you see a network provider, and/or get a referral from an in-network provider and pre-approval if you choose to get care from a provider who isn’t in your plan’s network.
4. Watch Out for These Common “Surprise” Expenses
Annual “well-visits” like getting a physical are typically free of charge. However, lab tests are not always free and can easily cost you hundreds of dollars – especially if your provider is using an “out-of-network” lab or diagnostic center. When choosing your health benefit plan, be sure to look at the co-pay or co-insurance requirements for lab tests and imaging services. Also, during your appointments, ask your provider if the lab or diagnostic network is “in-network” and ask for alternatives if they are not. Don’t feel like you have to go to your provider’s preferred lab — or even have labs performed in their office — if it’s not a covered service under your plan. As the patient, you can choose where you receive your ancillary services. And, when in doubt, call your insurance company before your appointments to make sure you understand which labs and services are covered.
Other common “surprise” expenses to look out for include whether urgent care and emergency services are covered and what your coverage is for short-term and long-term hospitalization. Some health benefit plans have different co-pay/co-insurance requirements for each of these levels of care. Even if these expenses seem unlikely, consider this: one in ten of adults who describe themselves as “healthy” end up visiting the hospital because of an unexpected medical event.
Looking for more tips? Join us for one of our upcoming webinars. You can also get in touch with Venteur’s licensed advisors at firstname.lastname@example.org.