How to Evaluate Health Insurance Plans


If you are in the market for a health insurance plan, it is essential to select a program that offers the maximum coverage for the lowest cost. With a wide variety of programs available, evaluating your options starts with understanding what coverage you need and finding a provider with the plan options you’re seeking.  Following these simple steps can help you streamline your search and pick a health insurance plan with the best coverage for you and your family. 

Why You Need Health Insurance

Health insurance covers the costs of necessary medical care, prescription drugs, and other wellness services, depending on your policy.  With lifestyle diseases like obesity, heart disease, and diabetes on the rise in the United States, health insurance is more of an investment than a short-term expense. Those who opt for health insurance early on in life will enjoy the benefits of lower rates as they grow older. Health insurance coverage can also offer you free preventative care such as screenings and vaccines. Depending on your plan, some check-ups may be included even before meeting your deductible.

Getting Insurance Through Your Employer vs. the Marketplace

Many people get their health insurance through their employers. These individuals don’t need to use government insurance exchanges and marketplaces. You may still want to seek an alternative plan if your employer offers you health insurance, but keep in mind that it will cost you more. Most employers will pay a portion of employees’ insurance premiums. If your employer does not offer health insurance, do your due diligence when shopping around the Health Insurance Marketplace. This will help you pinpoint the plan with the lowest monthly premiums.

Comparing the Types of Health Insurance Plans

When you compare plans, you will come across different insurance policies. The most common types are:

  • HMO: Health Maintenance Organization
  • PPO: Preferred Provider Organization
  • EPO: Exclusive Provider Organization
  • POS: Point of Service Plan

Finding the best plan is a matter of examining your medical needs and those of your family members. Consider what kind of treatment or prescription drugs you’ve required in the past or anticipate needing in the future based on your family medical history. Identify healthcare trends and make the decision that best matches your potential needs. HMO and POS insurance plans are types of managed care plans that require you to see a primary care doctor before seeing a specialist or scheduling a procedure. This causes many consumers to prefer other plans that forego this requirement. However, an HMO or POS plan might be a better choice for those looking for the cheapest plan. If you prefer choosing your specialists rather than leaving it up to your primary care doctor, then selecting an EPO or PPO is the better choice for you. An EPO offers lower total costs as long as you find a provider within the network. On the other hand, a PPO is a better option for those that intend to seek care from doctors outside the network.  

High-Deductible Health Plans With a Health Savings Account

A high-deductible health plan or HDHP usually has lower premiums but will require you to pay higher out-of-pocket costs. The greatest advantage of an HDHP is that they qualify you to open a health savings account. A Health Savings Account, abbreviated as an HSA, is a savings account that allows you to put money aside to pay for qualified medical expenses. The untaxed dollars you set aside translate to a lower overall cost of health care.

Comparing Health Plan Networks

The purpose of networks is to offer insurance companies lower rates. That is why visiting an in-network doctor costs you less. If you have a doctor you trust for your medical condition and do not want to switch to a different provider, choose a plan that allows you to select your physician. If you aren’t limiting your plan choices around a preferred doctor, search for a plan with a vast network. This will give you the most flexibility to choose the best doctor for your particular medical condition.  Choosing an extensive network is even more critical for those in rural areas. Signing up with a network that offers you more options ensures you’ll have a better chance of finding a provider that accepts your insurance plan.

Evaluating Your Out-Of-Pocket Costs

In making your choice, the amount you have to pay out-of-pocket should be clear. Consider the out-of-pocket maximum amount you’re willing to pay when examining cost-sharing options like deductibles.  Compare the costs on state and federal marketplaces and understand that the total you can spend out-of-pocket per year is limited. The maximum amount you can spend is listed in your plan. The higher the portion of your medical costs a plan pays, the higher your monthly premiums. Make your decision based on your medical history and the costs you can expect to incur.

Weighing the Benefits of Each Plan

At this stage in your research, you will likely have only a handful of insurance plans left in consideration. To make a final decision, weigh the benefits of each option and determine which plan provides the best coverage for an affordable rate. Ask yourself:

  • Do any of the plans on your shortlist have better emergency coverage than the others? 
  • Will I potentially need mental health care or physical therapy? 
  • What medications does each plan cover? 
  • Are there certain drugs I will need for a specific condition that my health insurance plan should cover?
  • Does this provider have good customer service? 
  • What is the open enrollment period, and does it work when I want my coverage to start? 

Once you weigh the summary of benefits, such as maternity services and overseas coverage, you may feel ready to make your selection.

Learn More About Shopping for Health Insurance

At Finance is us, we help you sift through the endless information and get the best coverage by matching your needs with the best health plan available. Our online resources can assist you in navigating the insurance plan evaluation process so you can find a plan that protects you and your family from unexpected health care costs.    Disclaimer: All content on this site is information of a general nature and does not address the circumstances of any particular entity or individual, nor is the information a substitute for professional financial advice and services. 

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