How to Choose a Health Plan That's Right for Your Family

When faced with confusion over how to choose a health plan or selecting coverage from the options that are offered by your employer, should you base it on the doctors in the plan, your family's history of health issues, your children, or the cost? When considering how to choose a health plan, all those elements should be taken into account.

To simplify the process, here are seven questions to ask yourself as you make your health plan selections.

1. Are Your Current Doctors Part of the Health Plan?

Confirm that any medical practices or hospitals you use, or might use, will accept your new health plan. Under most health plans, you can see physicians who aren't part of the plan, but you may pay more -- sometimes twice as much -- out-of-pocket, and the health plan may not count these costs toward your deductible. (More on deductibles in a bit.)

2. Are You Pregnant or Planning Pregnancy?

Federal law requires all health plans to cover pregnancy and prenatal care as an essential benefit. If you want a midwife or doula to assist in your prenatal care and delivery, make sure the health plan you choose covers these benefits.

3. Do You Have a Child Who Doesn't Have Their Own Coverage?

Federal law allows you to cover your children until they are 26, even if they're in college, married, not living with you, eligible to enroll in their employer's plan, or otherwise financially independent. Just be aware that having children on your coverage -- regardless of their age -- will increase your costs.

4. Do You Have a Chronic Illness or Need Special Treatment?

Some illnesses require ongoing medical attention to avoid acute problems or hospital admissions. Do you regularly see a health professional or need certain medications? Make sure the plan you choose covers the treatment options you need.

5. Do You Have a Family History of Cancer or Disease?

Under current federal law, health plans must cover a plethora of preventive measures for high blood pressure, cholesterol, and colon cancer, among others. This is important because if your parents or siblings face any of these problems, you're at a higher risk. Consider the level of preventative care, and cardiac or cancer care and treatment, that's offered by practices and hospitals before you choose a plan.

6. Do You Need Extra or Special Coverage?

Does the health plan you're considering offer coverage for prescription drugs, dental, and vision care? This coverage may increase your premium and out-of-pocket costs, but most people need prescription coverage of some type. If you need anything beyond regular dental cleanings or eye exams, measure the cost against your needs and consider coverage.

7. How Much Can You Afford?

Answering this question is much easier once you understand the various parts associated with health care costs.

  • Your premium is the amount you pay monthly or annually.
  • Your deductible represents what you have to pay before the health plan starts paying for charges. Generally, the higher the deductible, the lower your regular premium.
  • Your copay designates the flat fee -- about $25 for primary care and $35-50 for specialty care -- you pay every time you see a doctor.
  • Coinsurance is what you'll have to pay for covered services, assuming you have no deductible. A common coinsurance percentage is 80:20 (the plan pays 80 percent of the charge, and you pay 20 percent).
  • Health Savings Accounts (HSAs) represent a handy tax-free way to save money to pay deductibles, copays, and coinsurance. Many employers offer HSAs and withdraw a set amount from your pay every month. If your employer doesn't offer an HSA, you can set up your own through a bank.
  • Discounts are available from some health plans for not smoking, exercising regularly, or joining a weight-loss program.

You don't know exactly what the next year will bring, but here's a way to get a quick snapshot of a plan's costs to you: Annual Premium + Deductible Amount + Estimated Copays (visits to your doctor multiplied by the copay amount) + Any Anticipated Coinsurance = Your Cost. Coinsurance complicates the formula because it's a percentage of procedures or tests that you don't always know you'll need in advance. As a start, if you had procedures or tests last year that required coinsurance, plug that amount into your calculations.

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