Help! $#@&! How do I pick a plan?!?
While Open Enrollment is closed, life doesn’t stop. Maybe you’ve moved to a new county or state, lost a job, or gotten married. Maybe you just turned 26 and lost access to coverage on your parent’s plan.
Picking a health insurance plan is tricky, no matter when you have to do it.
I’ve talked with multiple people in the last few days who were feeling overwhelmed by the prospect, and I realized that the process I go through would make a good blog post.
Setting the Stage:
To begin with, I’m going to assume that you are applying for coverage on the Washington HealthPlanFinder. You may be using Healthcare.gov or another state’s Exchange website. They are all similar, but for now, let’s assume that you’ve filled out the application and are eligible to pick a new insurance plan. Where do you start??
The number of companies that will sell you a plan may be as few as 1 or 2, and as many as 8-9. When you are offered over 70 plans to choose from it can be a bit daunting. So how do you winnow down your choices?
Here are the questions I start with, along with clarifying questions at the end of the post. Make sure you consider all of your family members:
Do you have a doctor that you want to continue to see?
Do you take any medications?
How often do you see a doctor? Do you have any chronic conditions?
Should everyone be on the same policy?
What is your risk tolerance?
What is your budget?
Do you have any preferences?
Once you have answers to all of these questions you should be able to filter out a lot of the plans that don't work for you. Your choices should be reduced to a much more manageable number. You can then compare plans side by side to determine which one is right for you.
Still have questions? Still overwhelmed with options?
Don't hesitate to call your agent - that is what we are here for!
We can help you navigate your choices to find the best plan for your situation.
Do you have a doctor that you want to continue to see?
Filter out the plans that don’t cover you doctor. This may get rid of half of your choices. You may decide that it costs too much to continue to see your doctor and choose a plan that doesn’t cover them, but start by looking at the plans that will cover them.
Repeat for any other doctors. This gets a bit tricky since you can only filter on one doctor at a time. So grab a piece of paper and see if any companies and/or networks cover all of your doctors.
There may not be plans that cover all of your doctors. If this is the case, you will need to prioritize which doctors are most important.
Do you want to pay for a plan that has out-of-network benefits?
Do you want to find new doctors to replace the ones that are not covered?
Do you want to pay for some of them out of pocket since you see them infrequently?
Do you have a mental health provider? Some plans require that you meet your deductible before mental health is covered. Run the numbers – it may not make a difference if your mental health provider is covered or not.
Do you take any medications?
Are they generic drugs or brand name drugs? Some plans cover generic drugs immediately, but require you to meet your deductible before they cover brand name drugs.
If you have brand name drugs consider a Silver or Gold plan so you don't have to meet the deductible first.
What are the copays for the drugs?
What is the cash cost of the drugs?
Compare the premium of the different metal tiers with the prescription cost. A gold plan may have really good prescription coverage, but if you are taking only generic drugs, it may make sense to pay a little more for the prescription and save on the monthly premium.
How often do you see a doctor? Do you have any chronic conditions?
Do you prefer to pay a copay when you see the doctor?
If you have regular appointments, a copay plan may be easier to budget.
Your healthy college student may be more willing to go to the doctor if they know the cost in advance.
Copay plans tend to cost more and have a higher out of pocket limit.
HSA (Health Savings Account) plans can work well for two groups: those who never go to the doctor and those with expensive chronic conditions.
If you rarely go to the doctor, the HSA plans tend to have lower premiums but you need to meet the deductible for most benefits (except preventive care).
If you have regular doctor visits, expensive procedures, and/or costly medication, the HSA plans can work well. The premiums and out-of-pocket maximums are usually lower than other plans in the same metal level.
There are tax advantages to using a Health Savings Account to pay for qualified medical expenses. (Talk to your tax advisor to see if it makes sense for you)
Should everyone be on the same policy?
For families of 3 or more, the answer is usually yes:
Tax credits can be much lower when split between policies
The family deductible and family out-of-pocket maximum are only two times the individual limit, regardless of the number of family members
It can make sense to have two policies if you are a couple and:
You don’t receive tax credits
One person has vastly different medical needs
Your doctors are in different networks
What is your Risk Tolerance?
Does a large deductible scare you?
Do you have savings available to cover a large deductible?
Would you trade lower premiums for a higher out-of-pocket maximum that may not materialize?
Do you want to pay more premium to avoid higher deductible and coinsurance costs?
Do you normally meet your yearly deductible?
Do you have scheduled surgeries, procedures, or treatments that should be taken into consideration?
What is your Budget?
All of the previous questions are helpful, but if you don’t pay for the coverage it won’t do you any good.
Can you afford the plan you want?
If you receive tax credits, can you afford your chosen plan if the tax credits are taken away?
Do you have a variable income where lower premiums would be beneficial?
Most people go with a Silver or Bronze plans. Gold plans have great benefits, but the cost may not pencil out. The premium is a fixed cost, whether you use your insurance or not.
If you are low income and qualify for a Silver plan with Cost Share Reductions, it may be worth paying a bit extra if the reductions are significant and use your coverage regularly.
Do you have any other preferences?
We all have opinions and preferences – and those definitely play into the decision making process.
Are you coming off of an employer plan and want to stay with the same company?
Are there companies that you won’t consider or want to avoid?
Are you willing to pay extra for convenience?
