Finding the right affordable health insurance plan for you requires understanding health insurance terms. Here’s a look at what you need to know when shopping for affordable health insurance.
annual costs and premiums
The first thing you’ll likely notice when shopping for health insurance is the monthly premium. What you pay typically varies depending on your insurance company, your deductible, where you live, which plan you choose, how many people are covered, your age, whether you smoke, and your family size and household income.
In the health insurance marketplace, ACA plans are divided into four “metal” categories, which indicate how costs are split between you and your health insurance plan.
Bronze – You pay the lowest premium each month, but you also have a high deductible, so when you seek care, you have higher costs because it will take longer to meet your deductible. this metal plan is ideal if you only want worst case scenario coverage. your health insurance pays 60% of your health care costs and you pay the remaining 40%.
silver: This monthly premium is slightly higher than bronze plans, but your costs are lower when you seek care. your health insurance pays 70% of your health care costs while you contribute 30%. if you qualify for cost-sharing reductions, you must choose a silver plan.
gold: If you see your doctor routinely or need care, consider a gold plan, which has a higher monthly premium but lower point-of-care costs. your health insurance pays 80% and you pay 20%.
Platinum: This plan features the highest monthly premium, so if you need care frequently, you can be sure that most of your care will be covered with minimal point-of-care costs. when you use any service.
Related: bronze, silver, gold or platinum health insurance: which level to choose?
hsa vs. fsa
When searching for the most affordable health insurance plan for you, it’s important to know the difference between an fsa and an hsa. Health Savings Accounts (HSAs) only come with high-deductible health plans. The federal government decides what is considered a high deductible each year. See the minimum health insurance deductible required for an HSA, as well as the maximum savings account benefit. If an HSA is important to you, look for the “HSA Eligible” label when you shop. medicare and tricare plans are not eligible for hsa.
With an HSA, you can lower your overall health care costs by saving money before taxes in a dedicated health savings account. With an attached debit card, you can use these funds to pay deductibles, copays, coinsurance, and qualified medical expenses. An HSA cannot be used to pay the monthly premiums associated with your health insurance plan.
You can keep an HSA regardless of your employment status, and after you turn 65, you can treat it like a retirement account, using the funds however you want without penalty.
See also: How much is yearly insurance on a house
Meanwhile, a flexible spending account (fsa) is a similar benefit provided in conjunction with health insurance plans offered through your employer. You fund your FSA with pre-tax dollars from your paycheck and use a matched debit card when you want to use the funds for qualified medical expenses. One drawback to FSAS is that the amount you save is unlikely to roll over from one year to the next. that is, if you don’t use it by a certain date, you lose it.
It is unlikely that you will qualify for these two benefits simultaneously.
It is usually cheaper to see in-network providers than out-of-network providers. If you go out-of-network to see a preferred provider or visit a preferred facility, know that they are not contracted with your health plan provider and will likely cost more, sometimes even full price.
To keep costs down, choose a plan that includes your preferred care providers in its network, or choose a more lenient and flexible plan when it comes to out-of-network coverage.
maximum out-of-pocket expense
This amount is the most you could have to pay for health care services in a single year. your deductible, copays, and coinsurance for any in-network services count toward this maximum. monthly premiums, payments for non-covered services, and costs for out-of-network visits do not contribute to your out-of-pocket maximum.
once you reach your maximum, your health insurance plan kicks in to cover 100% of your costs for the rest of that year. So, if you’re trying to find the most affordable health care plan, pay close attention to your out-of-pocket maximum and how much you could support it.