How can I know I'm purchasing the right health insurance policy?
Who is this for?
This information will help if you're shopping for individual health insurance and want to know how to pick the right plan.
The Affordable Care Act means health insurance plans for individuals and families will have more in common, like metal tiers and essential health benefits. But you'll still have some decisions to make when finding the right plan for you and your family.
The most important thing to consider is how much you use your insurance. If you go to the doctor a lot, you may want to pay more each month for a plan with lower out-of-pocket costs. It makes your medical expenses more predictable.
If you're healthy and rarely go to the doctor, you might want a plan with lower monthly payments. But that means you'll pay more out of your pocket when you do need medical care. Lower-priced plans have higher deductibles and coinsurance.
How it works: meet Mike and Lisa
Mike and Lisa are both self-employed, so they buy their own health insurance. They don't have much else in common, except they both need to choose a new plan for 2014.
Mike's married with three teen-aged children all involved in sports. Between minor sports injuries, typical illness and managing Mike's mild high blood pressure, the family goes to the doctor and fills prescriptions frequently.
Lisa is 33, single and has no children. She's rarely ill and exercises regularly. Last year her only medical expense was a doctor bill and prescription when she got bronchitis.
What's the right health plan for them? Mike could lower his monthly premium by choosing a plan with a high deductible. But what he'll spend to meet that deductible and on doctor and prescription copays and coinsurance is more than what he saves. And since illness and injuries don't happen regularly, other than his premium Mike doesn't know what his medical expenses might be each month.
Although his premium will be higher, Mike is probably better off with a plan that has a low deductible. He'll quickly meet his deductible. His plan will start sharing costs much sooner. His coinsurance will also be lower. His costs will be more stable, too.
Lisa could also lower her monthly premium by choosing a plan with a high deductible. In fact, she seems like a great candidate. Why pay for something she doesn't use? But what Lisa doesn't know is that in a few months she won't feel so good. After doctor visits and tests, she'll be diagnosed with high blood pressure. Now she has a health condition to manage—and a lot of bills to pay on top of her premium because she has to meet her high deductible before her insurance starts sharing costs.
What's right for you?
Everyone's life is different. But no one is immune to illness and injury. That's why there's health insurance. A good approach is to get a plan that balances the lowest out-of-pocket expenses with a monthly payment you can afford. That could be the right plan for you.
A subsidy can help make your health insurance more affordable. You can use our subsidy estimator to see if you're eligible.
- How to understand deductibles and their impact on premiums
- How do out-of-pocket maximums work?
- How can I lower my monthly health insurance cost?
- Individual and family health insurance - check out our MyBlue℠ plans that fit your health care needs and your budget.