It's open enrollment season, when Americans sort through confusing options and try to predict how often we'll get sick next year.
Some people, such as those shopping for plans on the Affordable Care Act insurance exchanges, face bigger price tags. Rolling over into the same plan might not be an option for people who learned that their plans are being eliminated or that their premiums are doubling. Workers who get insurance through their jobs also could find new options for next year, such as telemedicine services, and rising drug costs.
Whether you're getting help from an expert or figuring it all out on your own, you'll increase your chances of landing in the right plan if you ask yourself some questions.
1. How often do you get sick?
Knowing how often you could need to go to the doctor helps determine how much you should shell out for health insurance. Every insurance plan requires you to pay a premium, or the amount that you pay each month up front, if you want to be covered.
If you don't see yourself going to the doctor that often, then you could look for a plan with a low premium. These plans have lower monthly costs, but they require you to pay in full for many doctor's visits and prescriptions until you've paid a set amount out of pocket, known as a deductible. Once you hit that deductible, full coverage kicks in. But you may want to read on for some caveats.
If you know you'll be visiting the doctor often or needing more care, you could be better off choosing a plan with bigger monthly premiums that will cover a larger share of your medical bills. Such plans typically let you pay a small fee, known as a co-payment, when you go to the doctor or fill a prescription. "In a sense you're paying in advance, knowing that you're going to need more care," says Steve Wojcik, vice president of public policy at the National Business Group on Health, which represents large employers.
2. How much cash do you have in the bank?
While plans with low premiums might seem appealing for people with few health problems, the decision depends on your budget.
If you have several hundred or thousand dollars in cash, you might prefer a high-deductible plan, even if it required you to pay for health services out of pocket until your deductible is met. Plus, if it turns out you don't have many health problems, you would reap the savings of the lower monthly premiums.
But if your budget is tight and you expect you'll be using your health insurance a decent amount, a plan with bigger premiums would make more sense. Take, for example, people who are planning for a baby or those treating a chronic condition. Paying more every month can help them avoid price shocks that could cause them to fall behind on other bills, says George Lane, a principal at Mercer, a benefits consulting firm.
3. Will you be able to see your doctor?
Do you and the kids already have doctors you know and trust? Call their offices to see whether they'll be covered by the plan you're considering.
Insurance companies typically charge higher fees to consumers who see doctors who aren't in the plan's network. Some plans won't cover any part of the bill for consumers who go outside of the network. Those extra costs may be manageable for occasional visits, but the fees can add up over time. So before you sign up for a plan, make sure the doctors in the network will meet your health needs, says Cynthia Cox, associate director of health reform and private insurance for the Kaiser Family Foundation.
Likewise, think about how much flexibility you need when it comes to choosing a doctor. Health maintenance organization plans, known usually as HMOs, tend to be less expensive but have fewer choices when it comes to doctors. Those plans could require referrals from people's primary care doctors before a consumer can see a specialist; and he may not be covered if he wants to see a doctor outside the network. People who want to be able to choose their own specialists without having to run it by their primary care doctor could consider a preferred provider organization plan, or a PPO, which will likely offer more options.
4. Will your drugs be covered?
Just as you did with your doctor, find out if the medications you need will be covered, Cox says. If they are not, you may be on the hook for the full cost of the drug. If you have a high-deductible plan, you may need to pay for your prescription in full each month until you've paid your deductible. For some medications, that can lead to a monthly bill of a few hundred dollars or more -- and that's in addition to your monthly premium. Review the list of covered medications, since those can change often, and factor those costs into your decision-making process.
5. What else can you do to lower your costs?
People with high-deductible plans may have the option of opening a health savings account or a health reimbursement account, which can be funded with pretax dollars and used to pay for certain health-care expenses tax-free. While some plans are a little difficult to use, a family contributing the maximum $6,750 could earn about $2,000 or more in tax savings each year, depending on tax bracket. Money that isn't used can be rolled over to pay for health costs in future years, Lane says.
People who don't have high-deductible plans may be able to set up a flexible spending account. Those are also funded with pretax dollars, but they have a smaller contribution limit and need to be used in full each year.
In addition to tax benefits, your plan may offer other programs to help you save on health costs. Many plans are rolling out better price-comparison tools that can make it easier to see how much one procedure, such as an MRI, might cost at one hospital vs. another, Lane says. More employers are also covering telemedicine services, such as those that let consumers consult with a doctor over the phone or through a video chat. About $40 a visit, it can be an appealing option for people who want the convenience of seeing a doctor remotely, Wojcik says. For people with high deductibles, telemedicine can also be less expensive than seeing a doctor in person.
ActiveStyle on 11/14/2016