3 Things to Consider When Signing Up For Health Insurance
The problem that most people have with their health insurance plan is rarely with the actual coverage – people are generally only upset when their plan doesn’t cover something they thought it would or when they are surprised by some costly detail that wasn’t made clear at enrollment. Insurance companies don’t do the best job of educating patients on the actual details of the plans they are selling, but the information you need to know to set proper expectations is available if you know where to look. You’ll have to do some work and learn some pretty boring things, but you are the one who ultimately has to understand the details of your plan’s coverage, not your insurer. The point of this article is to help you understand the crucial differences between possible plans and help you feel comfortable with the coverage you choose.
The entire concept of health insurance is that you are basically making a bet on your health. The healthier you are, the less likely you are to use your insurance for high cost medical services. Your insurance company knows this and sets their prices accordingly. If the insurance company thinks you are going to cost $5,000 to cover this year, their goal is to set your total premiums and out-of-pocket expenses to more than $5,000 so they can make a profit.
This is the bet – who will get the better deal once all of your medical expenses have been paid?
The benefit structure of every plan offered by insurers is carefully calculated to give them the best chance of winning this bet. By understanding how your insurance plan works, you can put the odds back in your favor and make every dollar you have to spend on healthcare go much further.
There are three broad categories to consider when signing up for a new health insurance plan:
- Cost – How much will I pay in out-of-pocket expenses?
- Coverage – What services and medications will I have access to under my plan?
- Network – Is my provider “in-network” with my insurance plan?
Each component is equally important and can have critical implications on the others. While it is almost impossible to get your expected costs 100% right before things actually happen, just having a very good estimate will help you budget accordingly and avoid surprises when you seek medical care. If you need help with this calculation, our Health Insurance Cost Estimator Tool should help give you a good estimate.
I hope the following pages will help you fully understand the benefits, and consequences, of your choices when you’re deciding between two possible plans.
Continue reading to go into further detail on each one of these components.