Health insurance is complicated. When you attempt to choose your insurance plan on your own, without the help of professionals, you may run into some problems.
While many people receive health insurance from an employer, some must buy their plans through the government-operated marketplace or an insurance agent. Sadly, there are also those that go uninsured, which the Affordable Care Act has been working to change by making insurance more affordable.
The act, also known as Obamacare, also requires everyone to become insured with a major medical health insurance policy or risk paying a tax penalty. Therefore, there are a few types of health insurance you need to be aware of whether you’re signing up for insurance for the first time or changing your healthcare plan to suit your changing needs.
Each plan is not created to be equal in their offering, so the many options on the market today differ in quality and price. If you have specific medications to take daily or prefer to see your regular doctors, you may want to ensure your insurance covers all your specific needs.
There are a few essential things you should consider before comparing insurance plans, including the category of insurance you need, the cost of your healthcare, and the right insurance plan for you.
Insurance Categories and What They Mean
Different types of health insurance plans are typically broken down into four major categories that will show you how your plan share costs. However, the kind of metal category you have is not a direct relation to the quality of care you’ll receive.
The four types of health insurance you need to be aware of depend on what percentage of the cost is split between you and your provider. Options for these metal categories include:
Each of these health plans is simply organized by the level of benefits included in them, with bronze having the least amount of coverage and platinum distributing the most. All of these options vary, but each pays a share of an enrolled patron’s health costs.
Details vary among plans, as well as the deductibles associated with each. However, you can expect to pay the highest deductible with the least expensive plan. With a platinum plan, you may have no deductible or an incredibly small copay of 10%.
Common Types of Insurance Plans
Unlike the category of plan you carry, the type of insurance plan you choose does determine the level of care you receive.
The two main types of health insurance include the public options available such as Medicaid and Medicare or coverage from private companies, which cover most people in the United States. National brands, such as Blue Cross Blue Shield, Humana, Aetna or United are widespread and readily available companies many people use.
All private health insurance plans perform by creating partnerships with networks of healthcare providers, which vary significantly. Some programs will dictate the doctors you can use while others may limit your choices or charge more if you select a provider that’s not on their network.
There are five common types of insurance plans including:
- HMO, or Health Maintenance Organizations
- PPO, or Preferred Provider Organizations
- EPO, or Exclusive Provider Organizations
- POS, or Point of Service Plans
- HDHP, or High-Deductible Health Plans, which is often combined with a health saving account (HSA).
Health Maintenance Organizations
The most popular type of insurance plan you can purchase, an HMO plan means that an entire network of health care providers will offer you services. With this possibility; however, you may have the least freedom to choose your own providers.
After you select a primary care doctor in your network, who will oversee your care, refer specialists as they’re needed and provide preventative care, you will go to your primary care physician (PCP) for all your needs. Because HMOs don’t cover out-of-network costs, you will need to have your PCP refer specialists, and you must choose a physician included in your network.
Often, these plans are cheaper than most options.
Preferred Provider Organizations
The least restrictive type of insurance plan, you will have the ability to access your network of covered health care providers and still receive care from a doctor outside the system.
Unlike HMOs, with a preferred provider or organization, you can choose to see a doctor outside the network by directly paying a higher price. In-network doctors are typically cheaper, and you don’t need a referral from a PCP to see a specialist. Although, some states may still require that you have a primary care doctor.
PPO plans usually come with more expensive premiums than other types of insurance, but you and your family can see any health care provider you choose. You should still expect to pay deductibles for doctor’s visits and copayments when you’ve received non-preventative medical care, like treatment for a specific health condition.
Exclusive Provider Organizations
Less restrictive, an exclusive provider organization plan (EPO) is a mix between an HMO and a PPO plan.
EPOs allow you to access any health care provider or specialist in the network only. Unlike PPO plans that offer some coverage outside your plan’s network, EPO plans don’t. However, you won’t have to get a referral to see a specialist like you do with HMOs.
Typically, these plans fall in between HMOs and PPOs when it comes to price.
Another hybrid of HMO and PPO plans, a point-of-service plan (POS) will have an HMO-style network with a primary care physician where you need referrals for specialists. However, you’ll also have more affordable options and can pay more for an out-of-network choice.
POS plans cost most than HMOs but less than PPOs when it comes to premiums.
High Deductible Health Plans
A blend of many other available plans on the market, high deductible health plans (HDHP) are for those who don’t use their medical coverage often and want to save money by paying low monthly premiums. When you do use your HDHP, expect to pay a high deductible each time you need to see a doctor.
HDHP plans usually wind up linked to a health savings account or HAS-compatible healthcare plan.
Consider What Plan is Right for You
Weight your options by considering what plan is right for you. Do you often go to the doctor for preventative care or to see a specialist? Are you often sick, or do you hardly ever use your health insurance coverage? Would you rather pay a low monthly premium, or do you hate restriction when it comes to what doctors you can visit and when?
When considering the types of health insurance you need to be aware of, the best choice will be one that you can afford, contains the healthcare services you expect to require, and allows you to see the doctors you want. While there’s a plan out there for everyone, make sure you don’t break the bank each time you fall ill by becoming insurance with the right plan today.