Finding the right affordable health insurance plan for you requires understanding health insurance terms. Here’s an overview of what you need to know when looking for affordable health insurance.
Annual costs and premiums
The first thing you’ll probably notice when buying health insurance is the monthly premium. Generally, what you pay will vary depending on your insurance company, your deductible, where you live, the plan you choose, the number of people covered, your age, whether you smoke and your family size and income.
In the health insurance market, ACA plans are separated into four “metal” categories, which indicate how costs are split between you and your health insurance plan.
Bronze: You pay the lowest premium each month, but you also have a high deductible, so when you seek treatment, you have higher costs because it will take more to reach your deductible. This metal plane is ideal if you only want cover for the worst scenarios. Your health insurance covers 60% of your health costs and you pay the remaining 40%.
Silver: This monthly premium is slightly higher than the bronze plans, but your costs are lower when you seek treatment. Your health insurance covers 70% of your health costs while you contribute 30%. If you qualify for cost-sharing discounts, you must choose a Silver plan.
Gold: If you see your doctor regularly or need care, consider a gold plan, which has a higher monthly premium but lower point-of-care costs. Your health insurance pays 80% and you pay 20%.
Platinum: This plan offers the highest monthly premium, so if you need care frequently, you can rest assured that most of your care will be covered with minimal point-of-care charges when using any service.
HSA vs. FSA
When looking for the most affordable health insurance plan for you, it is important to know the difference between an FSA and an HSA. Health Savings Accounts (HSA) are only provided with high deductible health plans. The federal government decides what is considered a high deductible each year. Check minimum health insurance deductible required for an HSA, as well as the maximum profit of the savings account. If an HSA is important to you, look for an “eligible HSA” label when shopping. Medicare and Tricare plans are not eligible for HSA.
With an HSA, you can lower your overall health care costs by saving pre-tax money in a health-specific savings account. With an accompanying debit card, you can then use those funds to pay for deductibles, copayments, coinsurance, and qualified medical expenses. An HSA cannot be used to pay the monthly premiums associated with your health insurance plan.
You can keep an HSA regardless of your employment status, and after you turn 65, you can treat it like a retirement account, using the funds as you wish without penalty.
Meanwhile, a Flexible Spending Account (FSA) is a similar benefit provided alongside health insurance plans offered by your employer. You fund your FSA with pre-tax dollars from your paycheck and use a paired debit card when you want to use the funds for eligible medical expenses. A disadvantage of FSAs is that the amount you save is unlikely to carry over from year to year. In other words, if you don’t use it by a certain date, you lose it.
You are unlikely to qualify for both of these benefits simultaneously.
It is generally more affordable to see in-network providers than out-of-network providers. If you go out of the network to see a preferred provider or visit a preferred facility, be aware that it does not have a contract with your health insurance plan provider and will likely cost more, sometimes even full price.
To keep costs low, choose a plan that includes your favorite care providers in its network, or choose a plan that’s more forgiving and flexible when it comes to out-of-network coverage.
This amount is the maximum you could pay for health care services in a single year. Your deductible, copayments, and coinsurance for all in-network services all count toward this maximum. Monthly premiums, payments for uncovered services, and out-of-network visit fees do not contribute to your maximum disbursement.
Once you hit your maximum, your health insurance plan kicks in to cover 100% of your costs for the rest of the year. So if you’re trying to find the most affordable healthcare plan, pay close attention to the maximum outlay and how much it could possibly support you.