So now you have the quick and dirty Rebecca-approved guide to healthcare options for 2015, but what if you actually want to understand more? How do you assess how you use healthcare and then match that up with the plans available to make the best choice? And what do all those crazy terms mean that I am supposed to be able to understand to even understand what my options are?
Well, read on for a step by step guide to answering these questions and picking a plan in 2015:
FIRST - Assess How You Use Healthcare
Look back at 2014 and tally you and/or your family’s medical care in 2014 and perhaps 2013 as well if you can do so easily. Tally how many times you went to the doctor and what types of visits they were - urgent care? ER? Annual exam? Regular check up? Make note of whether you take medications or not and if you had lab work, physical therapy, alternative care, vision, dental, etc. Keep this tally handy as you prepare to do some math and look over plan options.
SECOND - Do The Math On Premiums
Barring a major illness, your insurance premium is the most expensive part of your insurance plan so the first thing you have to look at is the annual cost of your premium. A $500/mo plan is $6,000 ($500 *12 = $6k) over the course of the year. A more expensive plan might have a lower deductible and better benefits (copay instead of coinsurance for instance), but would you actually use the benefits? How much would they save you? If you hardly ever go to the doctor, you’re better off taking a low premium catastrophic coverage type plan because even though you’ll pay more when you go to the doctor, you’ll save so much on the premium over time that you should be able to afford to pay for the care you use instead of paying high premiums all the time.
THIRD - Look At Max Out of Pocket
Each plan will have an individual and family “Maximum Out of Pocket” cost. This is the total dollar value of copayments and out of pocket coinsurance after your insurance premium you are responsible for each year before your plan will pay 100% of covered expenses. If you know you have a major event coming up such as a major surgery or a pregnancy/birth you’ll likely reach this out of pocket max.
FOURTH - Deductible & Coinsurance vs Copay
Now its time to compare coinsurance, deductible and copay amounts - line these numbers up for the plans you are interested in because they will be part of your final calculations.
FIFTH - Final Math!
Now that you have all this wonderful information, its time for more math! It can be a little complicated depending on how many plans you are trying to compare, but your math doesn’t have to be perfect - it just has to give you an overall impression based on average use. Okay, it goes like this:
COPAY PLAN: Annual Premium + copayments for average use (i.e. $20 copay x 5 doc visits per year = $100) = estimated cost of insurance for one year of average use
COINSURANCE PLAN: Annual Premium + Deductible + (additional visits total out of pocket cost x coinsurance percentage) = estimated cost of insurance for one year of average use
MAJOR EVENT COMPARISON: Annual Premium + Max Out of Pocket Cost = estimated cost of insurance for one year with a major event such as birth, pregnancy, or a major surgery.
Compare and Choose
Now you can compare the cost of various insurance plans based on how you use them and make an educated decision about affordability. It takes some work, but it is worth it if you want to get a plan that meets your needs for a reasonable price. Sometimes what you really need to know is what your needs are, and how comfortable you are with risk (especially higher or lower maximum out of pocket cost) to help you decide.
In case some of the terminology is still confusing, here’s a little glossary of the more important terms for you:
amount out of pocket you are responsible for paying before your insruance starts to cover a percentage (coinsurance) of the charges
the percentage of charges you are responsible for paying under your insurance plan.
a flat amount due per service, this is usually not subject to the deductible - meaning you do not have to meet the deductible before taking advantage of these benefits.
IN NETWORK VS OUT OF NETWORK
An in network provider is contracted with your insurer to accept the insurer’s rates for service. You are typically responsible for a lower coinsurance for in network providers. Out of network providers are not directly contracted with the insurer, meaning that there is no “plan discount” for this providers services. Your insurance may not cover out of network providers at all, or if they are covered they would be subject to a separate higher deductible and a higher coinsurance.
Healthcare.gov - Contact with Questions!
The Healthcare.gov website is the place to go to reach your state exchange if you have one, or to compare plans directly if you don’t. You can also get in touch with an agent to help you!
If you’re interested in knowing more about the above from an alternative medicine perspective, please do not hesitate to contact me or comment below!
Until next time,
Rebecca M H Kitzerow is a Licensed Acupuncturist practicing in La Center, Washington. With over a decade of experience she has won 10 Nattie consumer choice awards from Natural Awakenings Magazine since 2014.