Choosing a Health Insurance Plan

Prior to purchasing a health insurance plan, prospective enrollees should learn about the important differences between the types of plans that are available.

This is an essential step because there are various coverage levels and a number of plans. Residents should find out what is available through their online state health insurance marketplace.

Then, residents interested in enrolling in health insurance should compare the factors that are most important to them among the different plan options. The most important factors for many members include the number of claims and paperwork that they required to fill out, their provider network and out-of-pocket costs.  

Discovering the differences and similarities between health insurance plans can help residents narrow down their options and determine which ones are best suited to their needs. For those who are unsure of what to look for in a plan should consider what is most important to them in a plan and what their health needs are.

Coverage Levels and Common Plans

Enrollees in all states have several health insurance plan options to choose from in the online health care marketplace. Each plan offers residents different benefits which vary in cost, coverage and provider networks. Moreover, residents who purchase plans through the marketplace rather than through an employer will be able to choose from several “metal coverage levels” such as bronze, silver or gold level.

There are several commonly used health plans. These plans are:

  • Health Maintenance Organizations (HMOs) – A cost-effective option for residents who prefer to have a pre-determined network of medical professionals. Also, requires members to obtain referrals to visit specialists. Are the often the most cost effective plans.  
  • Preferred Provider Organizations (PPOs) – Allow policyholders to obtain limited medical coverage outside of the provider network and to see specialists without a referral. PPOs usually cost more than HMO plans and require additional paperwork to be completed.
  • Exclusive Provider Organizations (EPOs) – Do not require members to obtain referrals to visit specialists but do not provide out-of-network coverage. Typically cost less than PPO plans.
  • Point-of-Service (POS) – Allow less freedom of choice for providers than PPO plans and are less comprehensive. Have different rates for in and out-of-network services.
  • High-Deductible Health Plans (HDHP) – Allows greater choice in providers and is most beneficial for enrollees without major health issues. Can be combined with a Health Savings Account (HSA) to use towards medical expenses.
  • Fee-for-Service (FFS) Plans – Allow the greatest freedom of choice in providers. Members can choose any health care facility and physician but must pay high costs for such a plan.

Furthermore, enrollees must select a coverage level for their plan. Below are the different levels of coverage that members can purchase:

  • Bronze – Insurer covers about 60 percent of medical costs.
  • Silver – Insurer covers about 70 percent of medical costs.
  • Gold – Insurer covers about 80 percent of medical costs.
  • Platinum – Insurer covers about 90 percent of medical costs.
  • Catastrophic – Insurer covers less than 60 percent of medical costs for certain members who are younger than 30 years of age.
  • Family – Covers multiple family members in one household under one policy.

Components of Health Insurance Plans

The first step to finding the right health insurance plan is to learn the basic components that make up these plans. Understanding the basics can make the details easier to compare. Then, prospective policyholders can decide on the features that are most important to them in a health care plan in order to make the best decision.

There are several important features that enrollees should consider when looking at different plans. One component that makes a difference to many is the procedure to process a claim or multiple claims. Claims documents take up the majority of the paperwork that policyholders are required to fill out.

Different plans involve different degrees of documentation and paperwork. Often, residents who can only see in-network providers are not required to submit any claims. However, most insurance providers utilize online claims systems to simplify and expedite the process.

Additionally, many members have a preference for the amount of freedom they have in choosing a health care provider and medical facility. Choosing a plan that permits members to visit out-of-network doctors is an important feature to certain enrollees thus must be considered when choosing a plan. Along the same lines is the provider network that a health insurer provides.  

Another aspect of health insurance that enrollees consider is an out-of-pocket cost. Most residents have a certain amount in mind when thinking about out-of-pocket health care costs. Thus, would prefer to worth within that budget when selecting a plan.

Out-of-pocket costs include the monthly premium, deductible, co-insurance fees and copayments. Members must also take into account the amount that they must spend before they will be covered at 100 percent. Generally, health care plans with low premium rates have higher deductibles and out-of-pocket costs.

Aside from the common health insurance plan components mentioned in the paragraphs above, there are other features that some residents may also find important. Some features are less common and thus, not available with all insurance plans. For example, not all insurers offer international health coverage.

However, enrollees who travel often may consider this an important feature in their ideal insurance plan. These members should seek out plans that offer travel coverage and then compare the other common traits that the same plan provides. It is also important to take note of the different costs of plans that provide health insurance for residents traveling internationally.