By Dannette Coleman, Medica Senior Vice President Individual and Family Business
Choosing a health insurance plan is one of the most critical decisions consumers face each year. If you’re looking for health insurance in the individual market (open enrollment is Nov. 1 – Jan. 31, 2016), you will want to think about the type of coverage that fits your circumstances. There are a lot of choices, whether shopping on MNsure (Minnesota’s health insurance exchange), or buying through an insurance agent or directly from a health plan.
One of the best ways to think about health insurance is the three C’s: Coverage, Cost and Credits. In the individual market, all health plans must provide coverage for a common set of benefits. Known as Essential Health Benefits, these include preventive care, prescriptions, childbirth, hospitalization, behavioral health and more. Premium costs are determined by the metal level (Gold, Silver and Bronze), which in turn are based on the amount of out-of-pocket costs for which you are responsible. The lower the out-of-pocket costs, the higher the premium. Gold plans have the lowest out-of-pocket costs and the highest premiums, while Bronze plans have the highest out-of-pocket costs and the lowest premiums. The question you need to answer is whether you’re comfortable paying more out- of -pocket as care is received or you’d prefer the predictability of having more of the total costs rolled into a monthly premium. Costs also vary based on family composition (the number and ages of people who are covered), geographic location and tobacco use. For those who are eligible based on income, subsidies are available in the form of tax credits to help offset the cost of your health insurance, including help with premiums, out-of-pocket costs (in the form or what’s called “cost sharing reduction”), or both. Note that the tax credits are only available if you enroll into the plan of your choice through MNsure.
Steps to Follow
After you’ve considered the three C’s, follow these four steps:
- Choose your network. Determine from whom and where you get care. You have the option to choose from a broad network that will give you access to the largest system of health care providers. Or you may be able to choose a care system-based network. Typically, a plan with a broad network is more expensive than a plan with a care system-based network. Check to see if your current provider is in the network you’re considering, or determine whether you are willing to switch providers if it will save you money. Note that not all networks are available in all areas.
- Choose your plan. Decide if you want a plan that features set copays or a health savings account (HSA) compatible plan that has a high deductible but allows you to use HSA dollars you’ve saved to pay some or all of your out-of-pocket expense. (Note that all plans cover preventive care at 100% as long as you stay in the network.) Then select the metal level you prefer: Gold, Silver or Bronze. A catastrophic plan may also be available for those who qualify (persons under 30 as well as those who qualify for a “hardship” exemption.)
- Choose individual or family coverage. Plans are available for single or family coverage for ages 0 through 64.
- Calculate your monthly premium. This information is available online at MNsure and health plan websites. Insurance agents also can help you determine the cost. As noted above, subsidies may be available to help offset the cost of your monthly premiums. Premium tax credits and reduced out-of-pocket costs are not available with a catastrophic plan.
- Sign up for the plan that best fits your needs. This can be done on MNsure, through an agent or directly on a health insurer’s website. Note that under the Affordable Care Act, all health insurers must accept you regardless of your health history.
With a little planning and forethought, selecting a health insurance plan that meets your needs can be broken down into these steps. And you likely will be much happier with your coverage.