When planning as to how to choose health insurance, you most likely don’t know what exactly health insurance is. Truth be told, people who even have their health insurance struggle with the terms and plans they currently have. To date, there are still people who are struggling to get their health insurance – confused or scared of something they don’t have an idea about can affect your decisions.
The majority don’t even know how to choose the best health insurance, let alone how health insurance works, so it’s just fair that people are afraid to get one. There are still many questions that prevent people from getting health insurance; they tend to steer away just from the sight of a Financial Advisor.
It’s relatively fine if you’re having second thoughts – you’ll be spending hard-earned money for it, who wouldn’t hesitate? Like with war, it’s best to get into battle if you are fully equipped. So getting the proper knowledge and know-how will be your best tool towards buying your first health insurance.
To start, clearing some frequently asked questions like; how much health insurance costs, why health insurance is expensive, or how to get health insurance are some common questions and stigma people have. We’re going to dig down some of this information that could hopefully provide answers.
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What is Health Insurance and How it Works?
In simpler terms, it covers almost every medical and surgical bill of an insured individual. People who are insured benefit by having the insurance company pay their medical expenses; some offer reimbursement, but most of the time, they are the ones who pay hospitals directly.
Everything sounds good, right? Having insurance pay your medical bills and all indeed looks good, but it’s good to know that you need to pay a monthly premium rate each month. Depending on the provider, prices could differ along with the plans and terms. This question is where people start to steer away from the idea, “why is health insurance expensive?”; Costs and pricing prevents people from getting insurances.
A matter of fact is, in reality, hospital bills and other medical expenses are far more expensive than getting health insurance. The benefits you’ll be getting from health insurance definitely outweigh the prices you’ll see from offers.
Typical plans usually cover hospitalization, outpatient, preventive care, maternity, child services, laboratory tests, rehabilitation services, mental health treatment, and even prescription drugs. Depending on the insurer, you can get the most out of the plans with reasonable pricing.
The average cost for individual insurance is $456 and $1,152 for family plans. It’s not easy to crunch these details for the majority since, based on recent studies, more than half of the U.S population gets their health insurance from their employer. Only a third of the population buys their plans from private insurance companies like Medicaid or Medicare.
How Does The Unemployed Get Insurance?
Since more than half of the people get their insurance from their employer, how would you get health insurance without a job? Choosing to get insured without an employer could easily overwhelm you. With the pricing and colossal of information that will crash onto you simultaneously, getting health insurance is a pretty tense yet wise decision. For the unemployed, you have an option to avail of the affordable health insurance plan through the Marketplace. The offers will be based on your income and the size of your family.
Another option you can opt into is checking in to qualify for the low-cost income programs from Medicaid. They can offer plans that will suit low-income families or individuals, and some could even get free plans depending on their status. The great thing about this is, they will rely on your income and household size, not whether if you’re employed or not.
How To Choose The Best Health Insurance?
Suppose you’ve already decided to buy your health insurance. In that case, you must first consider several factors before getting one: the average cost of plans, health insurance company, and best insurance plan for you are few things you need to consider.
If it’s not clear enough, you can get health insurance coverage when you’re employed; otherwise, you need to purchase it yourself. You can check different insurance plans from various institutions. But on average, the individual costing was $456 and $1,152 for family programs. Depending on your liking, you can choose the best insurance plan that suits you well.
1. Health Maintenance Organization
They are structured to allow them to provide insurance coverage seamlessly for their subscribers. They have a streamlined connection for their subscribers towards healthcare providers. If you want lower fees, you can choose this type of plan. The only downside is that since they are streamlined with specific healthcare providers, you also have a limited number of healthcare professionals and hospitals.
2. Preferred Provider Organization
A cheap alternative besides HMO. Subscribed individuals can get services at reduced prices with their preferred providers. If individuals want to see options outside of their selected providers (in-network providers), they will be allowed to do so at higher rates.
3. Exclusive Provider Organization
If you prefer a mix of HMO and PPO plans, you might want to consider EPO. With EPO, you will be getting a streamlined connection from specific providers; plus, you’ll be allowed to choose a primary care physician (PCP). PCP’s will be the ones to provide general health care and treatment, but if they think you need to see a different physician – the EMO plan will allow you to do so.
4. High-Deductible Health Plan (HDHP)
If you think you don’t need much attention in terms of healthcare services, you can check the features of this plan. From the name itself, it has higher deductibles annually. If you’re still not aware of deductibles, it’s the portion of the fee that subscribers cover, meaning they have relatively lower monthly premiums. The last key feature that defines HDHP from the rest of the plans; offers access to Health Savings Account (HSA). Health Savings Account is where subscribers can contribute funds in which they can use at a later time. It usually covers anything HDHP doesn’t cover.
5. Point-of-Service Plan (POS):
POS has a direct approach for its subscribers. They offer a variety of benefits depending on their usage of preferred providers and out-of-network providers. It’s primarily a hybrid of an HMO and PPO plan.
6. Short-Term Insurance Policy
This plan is popular amongst new employees since they can get insurance coverage for a short period – covering at least three month period. Most of the time, if you’re a new employee, your employer’s insurance policy could take some time before it kicks in. That’s where short-term policy comes best; while you’re waiting, you can have yourself, and your dependents insured. However, do take note that this policy doesn’t cover any pre-existing illness and could potentially remove you from the plan.
7. Catastrophic Coverage
Primarily available for young adults, they must receive a “hardship exemption” from the government for one to qualify. This plan has one of the lowest premiums than the rest of the insurance plans. This program is usually intended for individuals who don’t have extra money to spend monthly but can’t afford to live without and insurance. It’s good to know people are still willing to get insured despite having a limited amount of spending money.
Where To Buy Health Insurance?
Once you’ve chosen your preferred plan, you can then start canvassing rates and terms from Insurance Institutions. You can find affordable health insurance in your area if you check the available ones. So make sure to compare terms and plans for each insurer before you decide.
This is best for retired individuals since they already have standard offers for them.
The Health Insurance Marketplace was created in 2014 when the Affordable Care Act was enacted. You can visit the Marketplace to check offered options and coverage based on your location. You can also see information on plans from other private institutions outside the Marketplace.
3. Private Health Insurance Companies
Depending on your location, you can check the website of the available institutions. The type of coverage and rates will also depend on the company and location. Do take note, though, if you decide to enroll in a private insurance company outside the Marketplace, you won’t be eligible for the subsidies available under ACA.
Free Health Insurance
This question is often being raised, and for a good reason; most of us want free healthcare. Though U.S healthcare is not the same as U.Ks NHS, you can still check with Medicaid and Children’s Health Insurance Program (CHIP). Like we’ve mentioned, they offer the lowest rates up to free coverage depending on your status. They will solely base on your income and household size, so if you think you’re within that borderline, you might want to consider doing so.
Canceling Health Insurance
Canceling health insurance could be for different reasons, one of which is seeing a new available plan on your state’s Marketplace. But how can you cancel your health insurance? You can refer to the steps below for a more seamless transaction.
Contact Your Insurance Company: If you’re the type of person who loves sending emails instead of phone calls, sad to say it emails wouldn’t be enough. It’s recommendable to ring them and inform them about the cancelation. Prepare your policies and other vital information they might ask you.
Follow Instructions From The Representative: Do note that cancellation policies differ with insurance institutions, so write down the steps the representative will provide you to cancel the insurance policy.
1. Confirmation Numbers
It’s recommendable to write down the representative’s name and the cancellation confirmation number they will provide you.
2. Refunds on Pre-Payments
This is only applicable though with individuals who paid the total price. If you cancel the policy and still have the remaining months, most institutions refund pre-payments.
3. Getting New Health Insurance
Don’t ever cancel your current health insurance if you haven’t secured your new health insurance. At the same time, make sure that the two policies don’t overlap with one another. Submitting claims to two different medical policies is illegal.
4. Contact an Insurance Professional
Canceling insurance policies can be as much exhausting as getting a new one. It’s also recommended to get in touch with an insurance agent or broker. They can help you clear any difficulties you might face in the process.
5. Know Your Rights
Consumer protection will protect you from any nuances you might face during policy cancelation. It might differ with each state, but the bottom line is the protection of each consumer. Ensure to check the laws enacted in your state.
Canceling your health insurance policy is a thorough process, so make sure you won’t rush any steps throughout the process; it could jeopardize your healthcare assistance alongside your dependents.
Things To Remember
Do remember that as soon as you turned 26, you might need to get your own health insurance if you’re not employed.
It’s also applicable if you’re nearing retirement and have started thinking about life insurance retirement plan; plan ahead so you can prevent unwanted circumstances.
If you’re fully retired, you can apply with Medicare for better retirement coverage.
If you have any issues with the pricing and terms, remember to check within the Marketplace for more affordable insurance plans and terms.
Lastly, never be afraid to consult an insurance broker or insurance adviser; with the amount of information you’ll be seeing online, it can easily throw you overboard.
But with the help of an adviser, they can definitely help you with the processes that can typically overwhelm an individual.
We’ve already seen the importance of health insurance to everyone; since hospital bills can be far more expensive for most of us.
That’s why with the growing illness surrounding us, getting insured has become a necessity for the majority.
So make sure to get insured as soon as possible, because if it’s not clear yet, it could get quite extensive purchasing your health insurance.
In the end, it will still be your choice on how you’ll prioritize health insurance for you and your dependents.