At any stage in life, having the right health insurance plan is important.
Figuring out how health insurance plans work on your own can be daunting, but choosing an insurance plan without fully understanding it can lead to unforeseen medical expenses and confusion over coverage. If you are looking for a new health insurance plan, read on to learn more about how these plans work and how to choose the best one for yourself or your family.
Health Insurance Basics
When searching for the right health care plan, understanding some health insurance basics can make a world of difference. It is important to know what kinds of insurance are available, how these plans work and the differences between all the options. Every insurance plan is different, so understanding the different health insurance terms can help you choose the plan the best fits your needs and your budget.
Choosing the right individual or family plan is not as simple as just choosing the cheapest plan available. Selecting a health insurance plan with a low premium can end up costing more in the long run, since these plans usually come with high deductibles. Finding the right health insurance plan requires taking a careful look at personal or family medical needs and considering whether an insurance offers the right coverage for those needs.
Obtaining Health Insurance
Obtaining health insurance coverage for an individual or a family differs in every case, depending on what coverage is made available to someone. Employers typically offer their employees health insurance coverage, but there are other means by which to find insurance. Choosing an insurance plan offered by an employer is usually the cheapest option, as most employers cover a portion of the monthly insurance premiums. Those who are unemployed, self-employed or are not offered insurance through their place of work have the option of finding coverage through the federal Health Insurance Marketplace website.
The Affordable Care Act (ACA), the health care reform law more commonly known as “Obamacare,” established the Marketplace, which makes finding affordable health insurance easier and accessible to more Americans. Under the ACA, households with a total income between 100 and 400 percent of the Federal Poverty Level (FPL) qualify for tax credits, which lower the costs of Marketplace insurance plans. While anyone can purchase insurance through the Marketplace, households must meet certain eligibility requirements in order to receive tax credits toward a Marketplace insurance plan.
Another health care option made more accessible by the ACA is the Medicaid program. Medicaid is a health assistance program that covers those under a certain income level, as well as those who are disabled or elderly. The program helps cover the costs of health care services for many low-income individuals and families.
Individuals who lose health insurance coverage due to certain work-related reasons, such as job loss or a reduction in working hours, have the option of extending their coverage for a limited period of time. The Consolidated Omnibus Budget Reconciliation Act, or COBRA, requires that certain group health insurance plans funded by employers offer employees and their families the choice of extending coverage in situations where insurance coverage will end. COBRA-continued health insurance allows those losing their health insurance coverage the chance to continue coverage while they search for a new insurance plan. The loss of a job or loss of health insurance coverage is a qualifying event for most health plans with open enrollment periods. For example, the health insurance Marketplace allows those who have lost group health insurance at work to enroll in a Marketplace plan outside of the open enrollment period.
Having dental insurance coverage is similar to having health insurance coverage, but dental plans look a little different. Dental insurance plans cover a portion of an individual’s dental work, whether it is a preventive, minor or major procedure. Like general health insurance, dental plans typically have a deductible that must be met by the insured before coverage begins and typically involve a copayment for dental visits. However, the premiums, deductibles and copayments for dental plans are generally much lower in cost than those for health insurance plans.
Before choosing a dental plan, it is important to understand how dental insurance works. Dental insurance plans may come as part of a standard health insurance plan or as a plan that can be purchased separately. Standalone plans typically cover preventive procedures such as regular cleanings but usually require the deductible to be met before basic and major procedures are covered. Most basic and major procedures are only partially covered and require out of pocket payments by the insured party.
There are a few types of dental insurance plans available commercially. Some plans offer flexibility in the choice of dentist, while other plans require the use of a dentist that is in the plan’s network. Preferred provider organizations, or PPOs, typically offer lower-cost coverage when an individual chooses an in-network dentist but will still cover out-of-network visits and procedures. However, PPOs tend to have higher monthly premiums than other kinds of dental insurance plans.
Dental health maintenance organizations, or HMOs, offer lower monthly premiums but limit a plan members’ choice of dentist to only those who are in network. Dental indemnity plans or dental savings plans may also work for some seeking alternatives to traditional dental insurance.
Other Types of Health Coverage
There are several other types of health care coverage that are worth considering under certain circumstances. Individuals who are anticipating a gap in health insurance coverage have the option of buying a short-term plan. These plans last for a pre-determined amount of time and typically do not cover more than medical emergencies and hospitalizations. This options is best for those who want emergency medical coverage while switching between regular medical insurance plans.
Those who are planning on traveling or living out of the country for a period of time also have some health insurance options available. International health insurance plans offer coverage to those who are living abroad for an extended period of time. Short-term travelers can purchase travel insurance to cover any emergency medical services needed in the event of an accident or injury that may occur while traveling. Health care can be costly when in another country, so it is always a good idea to carry insurance when abroad.