Navigating Health Insurance Enrollment Season

A common mistake when choosing a health insurance plan is basing the decision solely on the monthly premium. That is understandable. The premium is a bill (or a deduction from your paycheck) you need to pay every month, even if you only see a doctor once a year for a checkup. But your actual costs may depend on several factors.

Consider also:

• The deductible. What you generally pay for covered healthcare services before your insurance begins to pay. Some services may be covered before you meet the deductible. A higher deductible often comes with a lower monthly premium.
• A fixed amount you pay for a covered healthcare service, such as a doctor’s visit or prescription. Specialist visits can cost more than visits to your primary care physician.
• Coinsurance. The percentage of the cost of a covered service that you pay after meeting your deductible.
• Doctor and hospital networks. Insurers contract with providers in their networks to negotiate prices. Out-of-network visits can cost more, or may not be covered at all. Make sure your preferred doctors are in the plan’s network.
• Out-of-pocket maximum. The most you will pay during a plan year for covered, in-network healthcare services. Your out-of-pocket maximum is frequently higher than your deductible. Once you reach the limit, your plan generally pays 100% of the cost of covered, in-network services for the rest of the plan year. Premiums, out-of-network care and services the plan does not cover generally do not count toward the limit.
• Prescription-drug coverage. Plans have lists of covered drugs, known as formularies. Prescription costs usually have their own copays and coinsurance, depending on the drug’s “tier” or price level. If you take regular medications, make sure they are covered by the plan.
• HSA eligibility. Health Savings Accounts are tax-advantaged accounts that let you save, grow, and spend money tax-free for qualified medical expenses. However, they generally must be paired with a high-deductible health plan. That said, certain Bronze and Catastrophic Marketplace plans are now considered as HSA-compatible under IRS rules.