1. Medical insurance is designed to help you cover the cost of health care, which can be very expensive.
In exchange for a monthly premium, a health insurance plan pays some or all of your medical costs when you get sick or injured. Having health insurance helps you avoid major financial problems like credit card debt, drained savings, or bills that go into collections and ding your credit score. Most importantly, having health insurance means you’ll be covered for most of the things that can happen to your body, such as broken bones, doctor visits, hospital stays and prescriptions.
You can get health insurance through your employer, private insurers or government programs such as Medicare and Medicaid. The type of health insurance you have depends on your situation and where you live. Private insurers offer a variety of plans, from traditional indemnity or “fee for service” plans, to managed care plans such as HMOs, PPOs and EPOs. Managed care plans have lower monthly premiums than fee-for-service plans, but they have restrictions on where you can go for healthcare and may require a referral from your primary care provider to see specialists or get certain kinds of tests.
2. When choosing a health plan, make sure the deductible and coinsurance are within your budget.
The annual deductible (sometimes called the “out-of-pocket expense” or “cost sharing”) is the amount you pay each year before your health insurance begins to pay for care. You have to reach your deductible before the health insurance company will begin to pay for anything, and it takes several doctor’s visits or prescription refills to get there. Most plans also have coinsurance, which is a percentage of the cost of a procedure that you will pay after reaching your deductible.
3. When choosing a health insurance provider, check customer satisfaction ratings and complaints.
A good health insurance company will have low customer complaints and high customer satisfaction, but these ratings can be different by region. Using a site that allows you to compare prices and customer satisfaction ratings for local and national companies can give you more information about the quality of a particular health insurance company before making a decision.
4. If you have specific healthcare needs, look for a plan that covers those services.
If you or a family member have an ongoing medical condition, choose a plan with comprehensive coverage that includes the services you need. These include preventive health services, such as vaccinations, screenings and physicals. It’s also important to find a plan that covers the medications you take regularly, including generics and brand names.
Lastly, consider plans with extra benefits you might want, such as 24/7 nurse lines and telehealth options. These can add up to big savings, especially if you use them frequently.