Who should shop insurance plans?
You should compare plans if…
- you are self-employed or un-employed,
- you are a full-time student who is older than 26,
- your employer-sponsored insurance is expensive and/or a high-deductible plan,
- or, you need dental insurance.
Don’t waste your time if…
- your employer pays your insurance premium,
- or, you are younger than 26 and your parent(s) have a family plan
Where do I shop / enroll?Go to the U.S. Government Healthcare site to find your state’s marketplace. You can also find plans at health insurance company websites, at your school, or through a broker, but keep in mind that tax credits and other financial assistance are only available through your state marketplace. For example, Minnesota provides discounts on most insurance plans, but you must enroll through the official government site.
Key terms to knowWhile shopping for a plan, you’ll need to know a few things to pick the best plan for you:
PremiumThe monthly fee you pay for insurance, regardless of whether you use it.
DeductibleThe amount you will pay in healthcare costs (e.g. doctor visits and prescription medication) before your insurance will cover anything.*
A fixed amount you pay for a covered health care service after you’ve paid your deductible.
Let’s say your cost for a doctor’s office visit is $100. Your copayment for a doctor visit is $20.
- If you’ve paid your deductible: You pay $20, usually at the time of the visit.
- If you haven’t met your deductible: You pay $100, the full allowable amount for the visit.
Similar to a copayment, coinsurance is the percentage of costs of a covered health care service you pay after you’ve paid your deductible.
Let’s say your health insurance plan’s allowed amount for an office visit is $100 and your coinsurance is 20%.
- If you’ve paid your deductible: You pay 20% of $100, or $20. The insurance company pays the rest.
- If you haven’t met your deductible: You pay the full allowed amount, $100.
Health Savings Account (HSA)If your plan has a high deductible, you are eligible to save money tax-free to use for healthcare costs using special banking account called a Health Savings Account. This is beneficial if you are pretty healthy, as you can choose a plan with a lower premium, and put the money you save aside in case you unexpectedly need more healthcare than you anticipated. Unlike an flexible spending account (FSA), your HSA will roll over each year.
Out-of-Pocket Maximum / Limit
The most you have to pay for covered services in a plan year (not including premiums). After you spend this amount on deductibles, copayments, and coinsurance, your health plan pays 100% of the costs of covered benefits.
For more terms see the Healthcare.gov Glossary.
How to pick a planBefore comparing plans, ask yourself two questions: how much healthcare will I likely need and how much can I afford?
Healthy? Consider Catastrophic.
If you are generally healthy and don’t anticipate going needing anything beyond preventative care (e.g. vaccines and annual checkups), you should consider a bronze or silver plan, or if you’re under 30, even a catastrophic plan.
These plans will have lower premiums, but high deductibles. You’ll save money if you don’t get sick, but you’ll end up paying a lot more for the care you do get.
Need lots of healthcare? Go Gold.
If you have a chronic illness, take prescription medications, or otherwise anticipate need a lot of health care (e.g. you’re pregnant), you will benefit from a Gold level plan. You will pay higher premiums each month, but you’ll have a much lower deductible and your insurance will pay for more of your care.
Need help? You can get free guidance from a local advisor in your state. See your state marketplace for more information.
*Some things, such as vaccines, may be covered before you use your deductible.