ArtsAutosBooksBusinessEducationEntertainmentFamilyFashionFoodGamesGenderHealthHolidaysHomeHubPagesPersonal FinancePetsPoliticsReligionSportsTechnologyTravel

How to Choose A Health Insurance Plan

Updated on July 18, 2008

What Health Insurance Plan to Pick from an Employer

Health insurance is big business, so you want to make sure you get your money's worth. Picking the correct health insurance plan can save you money in the long run. The important thing is find out as much as you can about the plan before hand and ensure the plan you pick fits your needs correctly, or you may wind up with an unpleasant surprise later on.

Health Insurance Terms

When reviewing health plans, obviously you want to compare premiums, but there are other factors you need to consider as well. When you review health plans, you are usually given some basic items to compare:

The monthly premium: the monthly charge for health insurance

Annual deductible: how much you have to pay out of pocket before the insurance company starts to pay

Co-pay and co-insurance amounts: co-pays are the portion you have to pay to your doctor for health care services. This is in addition to any deductible.

Co-insurance is the portion you have to pay after your deductible is met. This is usually a 80/20 percentage.

ER and hospital charges: this is usually stated as inpatient and outpatient co-pays

Prescription Drug coverage: this states how much you pay for generic, mid tier and brand name drugs. Prescription drugs may come with a separate deductible as well.

When considering premiums and deductible, remember to take into account how much the plan will cost for the entire year. For example, say plan A has a premium of $100 with a deductible of $500, and plan B has a premium of $150 with a lower deductible of $250, which is cheaper for the year? Plan A is cheaper: the monthly premium ($100 x 12=1200) plus deductible ($500) is $1,700; whereas Plan B costs $2,050,($150 x 12=1800) plus deductible ($250) = $2,050.

We will take three different kinds of people, and determine what kind of health plan they should select.

Type A

Type A patient rarely gets sick, rarely sees a doctor. He should choose a plan that has the lowest monthly premium, even if the deductible is higher, his chances of having to use his deductible are small.

Type B

Type B patient occasionally gets sick, has one or two prescription drugs she has to take on a regular basis. She should a choose a plan with a mid-range premium and deductible, depending on how much she wants to pay out of pocket.

Type C

Type C patient has a chronic illness (diabetes, high blood pressure, hypertension) and has numerous prescription drugs she has to take on a daily basis. She should pick a plan that has a lower deductible, and a low deductible for prescription drug coverage. Picking the lowest deductible possible means she will have to pay for less out of pocket.

The Difference between HMOs and PPOs.

You may be given the option to choose between an HMO and an PPO plan. What's the difference? With an HMO, you have to see your primary care physician in order to get a referral to a specialist. So you wind up paying two co-pays, one to see the primary care physician, and one to see the specialist. Keep in mind, HMOs discourage their physicians from givine referrals to keep costs down, so if you think you may need a specialist, go with the PPO.

Outpatient and Inpatient

Some health insurance plans cover inpatient procedures differently from outpatient procedures, or sometimes not at all. And what's the difference between inpatient and outpatient?

Most people assume since they stay overnight in a hospital that they are considered inpatient. Not true. The rules vary, but generally to be considered inpatient, and have your medical services billed as inpatient, a person must be in the hospital for more than 23 hours. More often than not, a patient is treated as an outpatient.

Many procedures are considered outpatient, such as X-rays, MRIs, cataract removal, hip replacement, nose jobs and laser vision correction. Today, hospitals report that more than 60 percent of all surgeries are done on an outpatient basis, and experts estimate that by the year 2017, that number will reach 75 percent.

Before picking a health plan, check to make sure they cover outpatient procedures, and if so, at what percentage. Twenty percent may not sound like much, but at today's health care prices an MRI that costs $3,000 can run you $600.

In conclusion, find out as much as you can about the various coverage plans from your human resources department so you can make an educated decision you can live with.

<script type="text/javascript"><!--

google_ad_client = "pub-9680997733428491";

/* 728x15, created 7/18/08 */

google_ad_slot = "1913220359";

google_ad_width = 728;

google_ad_height = 15;

//-->

</script>

<script type="text/javascript"

src="http://pagead2.googlesyndication.com/pagead/show_ads.js">

</script>

Comments

    0 of 8192 characters used
    Post Comment

    • Working Mom profile imageAUTHOR

      Working Mom 

      10 years ago

      Hi jdnyc!

      The basic principles apply for private plans as well, compare deductibles vs. premiums. Private plans will always be more expensive.

      Thanks for reading!

    • jdnyc profile image

      JR 

      10 years ago from California

      Welcome to Hubpages! And great tips on health insurance! Any suggestions on a good private plan?

    working

    This website uses cookies

    As a user in the EEA, your approval is needed on a few things. To provide a better website experience, hubpages.com uses cookies (and other similar technologies) and may collect, process, and share personal data. Please choose which areas of our service you consent to our doing so.

    For more information on managing or withdrawing consents and how we handle data, visit our Privacy Policy at: https://hubpages.com/privacy-policy#gdpr

    Show Details
    Necessary
    HubPages Device IDThis is used to identify particular browsers or devices when the access the service, and is used for security reasons.
    LoginThis is necessary to sign in to the HubPages Service.
    Google RecaptchaThis is used to prevent bots and spam. (Privacy Policy)
    AkismetThis is used to detect comment spam. (Privacy Policy)
    HubPages Google AnalyticsThis is used to provide data on traffic to our website, all personally identifyable data is anonymized. (Privacy Policy)
    HubPages Traffic PixelThis is used to collect data on traffic to articles and other pages on our site. Unless you are signed in to a HubPages account, all personally identifiable information is anonymized.
    Amazon Web ServicesThis is a cloud services platform that we used to host our service. (Privacy Policy)
    CloudflareThis is a cloud CDN service that we use to efficiently deliver files required for our service to operate such as javascript, cascading style sheets, images, and videos. (Privacy Policy)
    Google Hosted LibrariesJavascript software libraries such as jQuery are loaded at endpoints on the googleapis.com or gstatic.com domains, for performance and efficiency reasons. (Privacy Policy)
    Features
    Google Custom SearchThis is feature allows you to search the site. (Privacy Policy)
    Google MapsSome articles have Google Maps embedded in them. (Privacy Policy)
    Google ChartsThis is used to display charts and graphs on articles and the author center. (Privacy Policy)
    Google AdSense Host APIThis service allows you to sign up for or associate a Google AdSense account with HubPages, so that you can earn money from ads on your articles. No data is shared unless you engage with this feature. (Privacy Policy)
    Google YouTubeSome articles have YouTube videos embedded in them. (Privacy Policy)
    VimeoSome articles have Vimeo videos embedded in them. (Privacy Policy)
    PaypalThis is used for a registered author who enrolls in the HubPages Earnings program and requests to be paid via PayPal. No data is shared with Paypal unless you engage with this feature. (Privacy Policy)
    Facebook LoginYou can use this to streamline signing up for, or signing in to your Hubpages account. No data is shared with Facebook unless you engage with this feature. (Privacy Policy)
    MavenThis supports the Maven widget and search functionality. (Privacy Policy)
    Marketing
    Google AdSenseThis is an ad network. (Privacy Policy)
    Google DoubleClickGoogle provides ad serving technology and runs an ad network. (Privacy Policy)
    Index ExchangeThis is an ad network. (Privacy Policy)
    SovrnThis is an ad network. (Privacy Policy)
    Facebook AdsThis is an ad network. (Privacy Policy)
    Amazon Unified Ad MarketplaceThis is an ad network. (Privacy Policy)
    AppNexusThis is an ad network. (Privacy Policy)
    OpenxThis is an ad network. (Privacy Policy)
    Rubicon ProjectThis is an ad network. (Privacy Policy)
    TripleLiftThis is an ad network. (Privacy Policy)
    Say MediaWe partner with Say Media to deliver ad campaigns on our sites. (Privacy Policy)
    Remarketing PixelsWe may use remarketing pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to advertise the HubPages Service to people that have visited our sites.
    Conversion Tracking PixelsWe may use conversion tracking pixels from advertising networks such as Google AdWords, Bing Ads, and Facebook in order to identify when an advertisement has successfully resulted in the desired action, such as signing up for the HubPages Service or publishing an article on the HubPages Service.
    Statistics
    Author Google AnalyticsThis is used to provide traffic data and reports to the authors of articles on the HubPages Service. (Privacy Policy)
    ComscoreComScore is a media measurement and analytics company providing marketing data and analytics to enterprises, media and advertising agencies, and publishers. Non-consent will result in ComScore only processing obfuscated personal data. (Privacy Policy)
    Amazon Tracking PixelSome articles display amazon products as part of the Amazon Affiliate program, this pixel provides traffic statistics for those products (Privacy Policy)