– How do I get good coverage at an affordable price?
– What pitfalls do I need to look out for?
How to Purchase A Health Insurance
These steps can help guide you to the best coverage for you (and your family, if you are looking for them, too) at a price you can bear.
1. Check out the insurance plans your existing providers accept.
Do you already have a primary care physician or specialists whom you like and want to retain? If so, start your search for health insurance by calling those offices and asking them which plans they prefer, which other plans they accept and if there is any intention of changing what insurance they accept in the near future.
Calling your providers directly is not only easier than contacting insurance companies to ask if your providers are in network; it also means getting the most current information and the scoop on any upcoming changes. You don’t want to choose a plan from a particular insurance company because your doctor appears to be in the network, only to learn that the insurer’s list of in-network providers is outdated and incorrect – or your doctor is leaving the network next year. It’s very possible that not all of your current providers accept the same insurance.
If that is the case, you’ll have to make some tough decisions about which providers you want to keep seeing at in-network rates, which you might be willing to replace with different providers in your new insurance network and which ones you can afford to pay for at out-of-network rates. If you find yourself in this situation, ask your current providers about their cash and out-of-network rates to see what costs you might face if you have to choose an insurer that only has some of your providers in its network.
You’ll also want to make sure any prescription drugs you take on a regular basis are covered by the plans you’re considering, especially if the medications are expensive or don’t have generic substitutes.
2. Check out your options on the exchange.
If you’re not getting health insurance through an employer, there are two markets from which you can purchase it: the government market and the private market. You should consider both to see where you’ll get the best coverage for your budget. To see what your options are on the exchange, go to HealthCare.gov and enter your zip code. From there, you can click to be taken to the official website of your state’s health insurance exchange, if your state has one (click here to find out), or to the federally facilitated marketplace at HealthCare.gov, if your state doesn’t have its own exchange.
You’ll need the information listed in this checklist to apply for an exchange-based plan. One of the advantages of choosing a plan through the exchange is, if your household income is low enough, you may qualify to receive a subsidy to help pay your insurance premiums. Normally, you can only enroll in an exchange plan during open enrollment.
However, you can use the exchange outside of the open enrollment period if you have a qualifying life event, such as: You get married or have a child; you lose your existing coverage because of a layoff, divorce or other qualifying reason; or you receive benefits from Medicaid or the Children’s Health Insurance Program.
If you need to buy insurance in, say, June, and you don’t meet one of the special criteria, you’ll have to go to the private health insurance market and purchase a short-term plan. This plan won’t count as the required insurance you need to avoid tax penalties, but it will protect you against high healthcare costs until the next open enrollment period, since private insurance uses the same open enrollment period as marketplace insurance.
3. Compare your choices in the private market.
Unlike in the past, insurers offering Affordable Care Act-compliant plans can’t charge you higher premiums or refuse to cover you if you have a pre-existing condition so don’t assume that an off-marketplace plan will provide less coverage or cost more. To see what your options are, you can go directly to health insurance company websites or use comparison shopping sites. You will typically need to provide information such as your gender, date of birth, smoker status, household income, household size and zip code. If you have a spouse or children, you’ll likely have to provide their information as well.
The sites will then show you a list of plan choices and some of the most important details about each plan, such as the monthly premium cost, primary care co-pay, deductible, out-of-pocket maximum and covered prescription drugs. These sites may show you both marketplace and off-marketplace plans; keep in mind that you MUST buy a marketplace plan through the marketplace to be eligible for a subsidy.
4. Consider using an insurance broker.
If you didn’t find a clearly good option shopping on your own in the public and private health insurance markets, if you’re so overwrought you don’t even want to try or if you just don’t have a lot of time, consider getting expert help. Using a health insurance broker won’t cost you a penny, and the broker will do all the hard work of finding the best plan for your situation. Unlike a captive insurance agent, a broker is independent, meaning he or she can offer you plans from many different companies.
An insurance broker gets paid by commission from the insurance company whose plan you buy, and the plan will not cost you any more if you buy it through a broker than if you buy it on your own. Don’t confuse a licensed agent or broker with an exchange navigator; the latter cannot recommend a plan based on your needs, has not gone through a criminal background check and may have less expertise. That being said, a navigator can still be informative about your options on the ACA exchange, and you might feel that one is more impartial since he or she doesn’t receive any commission based on which plan you choose.
You need to have health insurance coverage to avoid tax penalties, which for 2015 was 2% of your annual household income above the tax return filing threshold, with a maximum of the national average cost of bronze plan premiums, or $325 per adult and $162.50 per child under 18 – whichever is higher. More important, you want to have coverage so you can afford to visit a doctor when the need arises. Having insurance and seeing a doctor regularly will help you prevent illness and catch and treat health concerns early, when they’re easier to deal with physically, emotionally and financially.
Don’t let a lack of health insurance lead you to a health crisis or medical bankruptcy. Also, make sure to check your coverage options annually at open enrollment time to see if a less expensive or better value plan is available.