It’s very tempting to avoid paying for health insurance. After all, it’s a costly investment, and you may never see any return. You might also think you’re never going to get sick, or you’ve enough money to cover unexpected medical treatment or long-term care. But what if you develop a serious illness, or are involved in an accident? Your medical bills could pile up faster than expected. The purpose of medical insurance companies is to help you avoid a financial catastrophe when it comes to medical care and treatment.
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Is Health Insurance Mandatory?
Obamacare came into effect in 2010 when President Barack Obama signed the Affordable Care Act (ACA). The ACA outlined the individual shared responsibility provision or Individual Mandate, which made health insurance mandatory for every American. Anyone found out of compliance faced a penalty.
From January 2019, however, the Individual Mandate penalty was eliminated, and you are no longer required to have health insurance. If you had health insurance in 2018, you might still have to pay penalties when filing your 2019 taxes. Penalty fees only apply for the years in which the ACA was still in full effect.
Although health insurance is no longer mandatory, it’s still advisable to get health insurance coverage. Having health insurance might be expensive, but the purpose is to protect you from high costs when you need health care.
10 Essential Benefits to Look for in Your Health Insurance Plan
When shopping for a health insurance plan, it should include the following ten essential services or benefits. Depending on your needs, your health insurance company may offer more benefits at an additional cost.
Ambulatory Care (Outpatient)
When you receive medical care or treatment without being admitted, it is known as ambulatory care. It covers doctor’s appointments, in-home visits, blood tests, X-rays, endoscopy, biopsy, vaccinations, asthma treatments, and pediatric checkups.
Emergency Care
This covers care or treatment received for any life-threatening or debilitating condition. Also included is coverage for any ambulance service and ER treatment.
Hospital Care
Hospital care covers admission to a nursing facility or standard hospital for treatment or care. Inpatient care includes surgery, lab work, and medication.
Laboratory Services
These cover any tests required for diagnoses, ruling out, or the monitoring of certain medical conditions.
Maternal Health and Care for Newborns
This includes all medical care associated with pregnancy, including prenatal care, labor, delivery, postnatal, and neonatal care.
Pediatric Services
Pediatric services can be any care provided to children. Treatment may consist of yearly checkups, vaccinations, dental care, and vision insurance.
Treatment for the Mentally Ill and Addicted
Coverage includes diagnosis, monitoring, or treatment of any mental illness or addiction. Whether it is inpatient or outpatient care, it provides counseling, behavioral health treatment, and psychotherapy. Some health insurance policies have a limit on the number of treatment days.
Prescription Drugs
Health insurance policies should include a minimum of one of every federal category or class of prescription medication. Most insurers have a list of preferred drugs and other restrictions. To be covered, you may have to select generic medicines.
Preventive Care
This covers any services associated with preventing, detecting, or managing an illness. It includes screenings, counseling, immunizations or vaccines, and care for chronic conditions.
Rehabilitation and Habilitation
This will cover any therapy or treatment associated with recovery from injury, illness, or disability. Physical, occupational, and psychiatric therapy and rehabilitation are all included.
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Factors Affecting Your Health Insurance Premiums
According to health care law, your insurance company is only permitted to use the following factors when deciding on your premium. Depending on your state, these factors weigh differently on the cost of your premium.
Your Age
Typically, the older you are, the higher your premium.
Your Location
Your premium may be affected by your state and local rules, insurance competitors in your area, and the cost of living.
Where you live has an enormous impact on your choice of health insurance companies. If you live in a larger city or densely populated state, you typically have more providers at your disposal. In more rural areas, you may only find one dominant health insurance company. However, let’s not forget that the internet has made finding a health insurance company much more straightforward.
Tobacco Use
Tobacco users may be charged up to 50% more than non-users.
Number of People Insured
As an individual, you pay lower premiums than if you were to add a spouse or dependent on your medical plan.
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5 Main Plan Categories
The plan category refers to how you and the insurance provider share the cost.
- Bronze – the least coverage with lower premiums and higher deductibles. The plan covers 60%, while you pay 40% of the medical cost.
- Silver – the plan covers 70%, with a 30% deductible.
- Gold – 80% coverage, with 20% deductible
- Platinum – the most coverage with high premiums and low deductibles. The plan covers 90%, while you pay 10% of the medical cost.
- Catastrophic plans – for individuals under 30, catastrophic medical plans come with a very high deductible.
Types of Health Insurance Plans
Even if you live in an area with few health insurance plan choices and companies, you can still find suitable coverage. The challenge is to find a health insurance plan to suit your individual or family needs. To make an informed decision, you need to understand the different types of policies and kinds of coverage.
Health Management Organization (HMO)
HMO plans are notorious for being the most restrictive. An HMO plan has a preferred list of providers. You need to be referred by a physician and must use one of the specialists within their network. Except for emergencies, if you receive care outside of their system, you’re responsible for all the costs. An HMO plan is an excellent way to go if you live in a city with a wider variety of medical facilities, or when receiving routine care.
If you need more specialized care, an HMO can be very limiting and expensive. It is in part due to a lack of available facilities that fall under your primary physician’s network. The plan restrictions will vary depending on your state and insurance provider.
An HMO plan is the most cost-effective as it tends to charge copays rather than coinsurance when receiving medical care or prescriptions. These flat copay rates range between $5 to $25 per received medical treatment or office visit. With coinsurance, you pay a deductible, ranging between $250 to $1,000, depending on your premium.
Preferred Provider Organization (PPO)
With PPO plans, you have much more freedom when choosing your health care provider. You can save money by staying within the preferred network of providers. If you use a different out-of-network provider, you won’t have to pay the whole bill. You also don’t require a referral from a single primary-care physician to see a specialist. A PPO plan is a better option if you want to have a preferred doctor or need specialized care outside of the network.
The higher the monthly premium, the lower your deductible when receiving care. Premiums can be as much as $1,000 per month. When receiving medical care or treatment, you need to pay deductibles before the insurance kicks in. The coinsurance cost is around 10% of the bill for in-network services and up to 40% for out-of-network treatment or care. With out-of-network care, you may have to pay the bill up front and file for reimbursement, which could be frustrating. Some PPO plans require copays rather than coinsurance.
Hybrid Plans – Point of Service (POS) and Exclusive Provider Organization (EPO)
A POS plan is a combination of HMO and PPO concerning cost and services. As with HMO plans, you need a referral from a primary-care physician. You have the option of receiving care or treatment outside of the network, as with PPO plans.
An EPO plan is the least common type. Essentially it is the reverse of a POS plan. You don’t need a referral as with PPO plans. However, you do need to stay within the network of providers as with an HMO. For more expensive services, you need preauthorization. Cost is also somewhere in between that of an HMO and PPO plan.
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Short-Term Health Insurance Plans
When changing jobs or shopping for new health insurance, you may be between coverages. A short-term health insurance plan is not a major medical plan, as with the above mentioned four. It is meant to serve as a stopgap plan or in-between option. It might be the cheapest available plan, but it comes with very high deductibles.
ACA regulations don’t apply to insurance short-term health plans. They often come with a cap on benefits and sometimes don’t offer benefits such as preventive service. If you have pre-existing health conditions, you may not qualify. Never use short-term health insurance as a substitute for primary medical insurance. You should only consider this option if you are young, healthy, or need temporary insurance. It’s most definitely not an option if you need long-term care insurance.
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Health Insurance Scams
While searching for a health insurance provider, you might come across some scams. Therefore, it is essential to be able to recognize a few red flags. Here are a few tips to reduce the risk of being conned.
- A medical discount card is different from a comprehensive health insurance policy.
- Avoid unprofessional-looking posters and marketing.
- Avoid companies with evasive sales representatives.
- Only provide credit card or bank information after seeing the policy details.
- You should receive your policy information and insurance card shortly after signing up. If not, it might be a scam.
- Refer to the National Association of Insurance Commissioners website for a list of licensed insurance providers in your state. If you’re unsure about an insurance provider, your local insurance commissioner can offer advice.
- If the deal seems too good to be true, it probably is.
Commonly Asked Questions
What can’t affect your premium?
There are a few factors that won’t affect your premium cost. Your insurance provider can’t charge different prices based on your gender. Your current health condition and medical history don’t change your premiums, either. Insurance will cover pre-existing conditions from the starting date of your policy.
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Can your health insurance provider drop you?
According to Federal law, your insurance provider is not allowed to cancel your coverage due to illness. Your provider cannot set annual or lifetime financial limits on the above mentioned essential benefits, either.
Can you get health insurance if you’re unemployed or have a low income?
It is possible to get health insurance through open enrollment periods. You might also want to look at less expensive coverage options through Medicaid. Let’s not forget the Children’s Health Insurance Program (CHIP) as well as other health centers in the community that may be able to assist.
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Does Obamacare Influence Your Health Insurance Plan?
All plans have a limit on yearly out-of-pocket medical expenses. Except for short-term plans, there are no caps on lifetime and annual benefits. According to the ACA, all deductibles, coinsurance, and copayments must be a reflection of this limit. Among other charges, your premiums and non-essential benefits don’t count toward the limit.
Top 5 Rated Medical Insurance Companies
You should, by now, have a better idea of what types of health insurance plans are available and the benefits they include. Other important factors to look for are the company’s financial stability, customer service ratings, claims process, enrollment period, and premium cost. Also, verify whether your current doctor accepts the insurance you intend to purchase.
The best health insurance company is one that provides sufficient coverage at affordable rates and deductibles. Keep in mind that your choices may be limited, depending on what is available in your area. Coverage options may vary depending on your state. When shopping around, get at least three quotes from different providers.
Here are a few reliable health insurance companies that have good reputations, policy offerings, and medical plan choices.
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Kaiser Permanente
Kaiser Permanente is one of the most trusted names in the health insurance industry. It has excellent financial strength ratings and good customer satisfaction ratings. It only operates within its system of Kaiser Foundation hospitals and medical center facilities.
The network has over 21,999 physicians with active practices. Kaiser Permanente offers several plan types. Depending on the policy, you may choose additional services such as adding a health savings plan (HSA) or indefinite doctor’s visits, after working hours care, and drug prescriptions.
Kaiser Permanente offers low rates. It also provides additional services for international travel coverage, a helpful app, and multilingual services.
What’s the catch? They only operate and offer coverage in the District of Columbia and eight states. These states are California, Colorado, Maryland, Virginia, Washington, Oregon, Georgia, and Hawaii.
Blue Cross Blue Shield
The Blue Cross Blue Shield Association is one of the largest health maintenance organizations, with almost 100 million American customers. It offers coverage in the US and over 170 international destinations, with temporary international coverage options when traveling. AM Best gave most of the 39 Blue Cross Blue Shield health insurance organizations across the nation an excellent A+ financial stability rating.
As a Blue Cross Blue Shield member, you have access to HMO and PPO plans. You also have the option of HSA and FSA health savings accounts. You can use the HSA and FSA funds to pay your deductibles. Benefits included in their health and wellness program include discounts for health clubs, fitness monitors, diets, and other services related to your health. Their prescription management option allows you to order your medicine online or by mail.
What’s the downside? Premiums tend to be a little high for older customers.
United Health Care
As one of the most significant health insurers in the US, United HealthCare has over 790,000 participating physicians. United HealthCare offers individual health insurance for essential care that meets ACA requirements. AM Best gives United HealthCare an A-rating for financial stability.
United HealthCare has a well-developed, easy-to-use online platform and mobile app where you can access your online care. It includes ordering prescriptions online, speaking with a nurse, and other online wellness programs. You can even set up doctor’s appointments, submit a claim, and search for physicians. It offers HMO and PPO plans with HSA and FSA add-ons. As a member, you qualify for discounts on hearing aids, vision services, and programs to quit smoking.
United HealthCare is one of the more expensive health insurance companies, but they operate nationwide.
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Aetna
Voted best for employer-sponsored health insurance plans, Aetna has a top-rated reputation. It’s also one of the biggest health insurance companies in the US with an A-rating on financial stability. The employer health plan is available across all 50 states, with supplemental health insurance coverage options.
Aetna offers all of the main benefits and health care services, and, as a member, you have access to HSA plans. It has a broad platform of in-network providers across the country. Their numerous wellness programs include gym memberships, weight-loss programs, and chiropractic services.
Aetna is one of the most affordable health insurance options on the market. Still, they don’t offer any short-term coverage options.
Cigna
Cigna offers health insurance in the following states: Arizona, California, Colorado, Connecticut, Georgia, Florida, Maryland, Missouri, North Carolina, South Carolina, Tennessee, and Texas.
It scored an A-rating for financial stability from AM Best. Cigna has over 500,000 participating physicians in its preferred provider network and offers a high-deductible health plan and HSA options. Your plan options, deductibles, and copay options vary depending on the state. As a member, you have online access to in-network doctors, estimates of health care costs, your claims status, and insurance ID cards. Member benefits also include a health information helpline, a rewards program, flu shot information, and home delivery pharmacy services.
These are only five of 2019’s best-rated health insurance companies in the US. You may also want to have a look at the Health Care Service Corporation (HCSC), Molina Healthcare, Highmark, and Humana.
International Health Insurance
Health insurance should be a top priority when planning to move or travel abroad. Before leaving the US, have a look at the medical insurance requirements in the country you wish to visit. You’ll find a variety of available health insurance plans at affordable rates. Your insurance company may not provide medical coverage while you are overseas. In such cases, travel medical insurance serves as supplemental coverage while you are abroad.
As with regular health insurance, you want to ensure that your international health insurance includes certain benefits and sufficient coverage. Here are some foreign insurance companies to consider:
- Cigna Global Medical Insurance plan
- Aetna Global Expat Health Cover
- GeoBlue Global Medical – Xplorer Worldwide Medical Plan
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Health Insurance is Highly Recommended
When you’re looking for a health insurance policy for yourself or your family, remember to consider a few critical details. Your health insurance plan should have sufficient benefits and coverage options, reasonable premiums, operate in your state, be financially sound, and deliver excellent customer service. We highly recommend that you have health insurance even though it’s no longer mandatory. Knowing that you are medically covered should provide you with peace-of-mind.
Have you recently purchased medical insurance? Have we missed some vital information that you want to add? Don’t hesitate to leave a comment below. We always enjoy hearing from our visitors.
