5 Important Factors in Choosing Family Health Insurance

May 7th 2016

The Affordable Care Act has more families looking at health insurance than ever before. It's easy to get confused with all of the forms, paperwork and benefits explanations that are given with each plan. It's frustrating to even figure out what type of plan is best for your family, an HMO or PPO plan. You don't want to choose the wrong coverage and have your partner or children deal with medical bills they shouldn't have to handle. Here are five of the most important factors in choosing family health insurance. 

1. Learn the difference between HMO and PPO

An HMO is a health maintenance organization, while a PPO is a preferred provider organization. An HMO covers your medical costs when you use specific providers. A PPO covers a percentage of your medical bills when you go to an in-network provider, but charges more when you use services outside of the preferred network. An HMO typically has a higher monthly premium, while the PPO has a lower monthly cost. 

2. Look at the list of primary-care physicians and specialists available with each program

If you, your partner or your children use a specific doctor or doctors, ensure that you have insurance-covered access to them. You may need a referral from a primary care physician before you see the provider, but you won't get turned away for pre-existing conditions any longer thanks to the Affordable Care Act. Use a third-party review site to determine whether these doctors meet your needs. A doctor or clinic may sound impressive at first, but word-of-mouth and online reviews may highlight problems. 

3. Read through the coverage available, specifically how much co-insurance you owe after the insurance company pays its part

The co-insurance kicks in after you've paid your deductible limit for the year. For some plans, the co-insurance is zero after the deductible. It's common to see 20 percent co-insurance, however. The co-insurance may differ depending on circumstances, such as an emergency room visit versus a doctor's office. Talk to the insurance company to find out exactly what coverage you're getting when you're at a doctor's office, at a hospital and out of network. 

4. Understand the amount of your co-pay

The co-pay is another cost that kicks in after you've gone through your deductible. This cost covers things like routine doctor's visits, preventative procedures and prescriptions. Generally, this is a fairly low cost, with the rest of the visit covered by insurance. However, it's important to know what does and does not have a co-pay component. Look at your household budget and create a savings category to cover medication and other co-payments. 

5. Balance your deductible with your monthly premium

Insuring a family is expensive, even if you are all healthy. When you add in health conditions, the cost goes up quickly. Usually, you can lower your monthly premium by allowing your deductible to get higher. However, you want to balance the feasibility of a high deductible against the monthly premium. Having a high deductible only saves you money in the long run if you can afford to pay it when medical care is needed. One option to help with a high deductible is a health savings account. This is a tax-advantaged savings account that is used to pay medical bills and help with a high-deductible plan. 

Choosing health insurance for yourself and your family is a difficult task, but it's made much easier when you understand exactly what you're looking for. The coverage charts become clearer when you know all of the technical terms involved with your health insurance package. Before you sign your next policy, make sure that it covers your family exactly the way you need, with the doctors you want to see. 




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