5 Pricing Factors for Health Insurance Quotes

May 7th 2016
The Affordable Care Act has shaken up the world of health insurance, and the market pricing factors are still adjusting to the new face of the insurance world. Gone are the days where you had to cross your fingers and hope that you get accepted with a company. Now, pre-existing conditions don't stop you from getting coverage, and the lifetime medical insurance caps are gone. If you're switching providers or picking up health insurance for the first time, keep a few pricing factors in mind when you look for health insurance quotes. 
Deductible and Co-insurance
A simple rule of thumb when pricing out your monthly insurance premium is that the more financial responsibility you take on out of pocket, the lower the amount you spend on your monthly premium. It's important to balance your premium payment with the amount you pay in health insurance throughout the year. You don't want a $5,000 deductible if you don't have that much set aside for medical expenses to pay throughout the year. The co-insurance is another factor that represents your out of pocket personal responsibility for health insurance, even after you've paid your yearly deductible. Co-insurance is the percentage that an insurance company pays for major procedures, such as surgery, births and other medical procedures that aren't in the day-to-day category of health costs. Factor in these percentages when you look at the type of plan you purchase, as you don't want to be surprised by a post-surgery bill when you weren't expecting it.  
Utilization
Another factor of health insurance that drives up the cost for everyone within the risk pool is how often services are used, according to the Colorado Division of Insurance. If you pick up insurance in an area with a particularly prominent elderly population who utilizes health services on a frequent basis, you'll find that your premium costs are higher. 
Physical Factors
Several physical factors play into your health insurance premiums as well, which is similar to automobile insurance prices. Your age, whether or not you smoke tobacco products and where you're physically living impact the amount you pay for health insurance, according to Healthcare.gov. Unlike car insurance, you do not get charged more or less of a premium based on your gender. 
Subsidies 
When you purchase a plan through the Affordable Healthcare Act, you qualify for tax credit subsidies on your health insurance monthly premium if you fall below 400 percent of the poverty income level. These tax credits may be applied directly to the premium if you go with a participating insurance company, or you take it at the end of the year through your taxes. These tax credits are intended to drive the cost of medical insurance down for a significant number of Americans, even if the basic premium ends up higher due to mandatory pre-existing condition coverage, a removal of lifetime limits and free preventative services. If you don't fall under the subsidy cap, however, you may find that switching from your existing plan to a new plan represents a significant price hike due to expanded services and coverage. 
Family Plans
You may assume that family plans are the way to go to get the cheapest health insurance for your entire family, but that depends on the health insurance your employer offers, whether they've changed how much they are contributing to your health insurance premiums and the type of coverage that you have as a family plan. If the price per person on a family plan is significantly more for the same amount of coverage a single plan offers, consider having your spouse take a single plan, while you keep the children on the family plan. Read the fine print to ensure that the coverage is similar and you have the same access to network doctors, so you don't have to hunt for new network specialists or primary care physicians. 
References:
(1) http://cdn.colorado.gov/cs/Satellite?blobcol=urldata&blobheadername1=Content-Disposition&blobheadername2=Content-Type&blobheadervalue1=inline%3B+filename%3D%22Factors+Affecting+Health+Insurance+Premiums+for+Plans+Effective+1%2F1%2F14.pdf%22&blobheadervalue2=application%2Fpdf&blobkey=id&blobtable=MungoBlobs&blobwhere=1251855100093&ssbinary=true
(2) https://www.healthcare.gov/what-factors-affect-marketplace-health-plan-premiums/

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