How to Buy Health Insurance for the First Time
Buying Health Insurance for the First Time
If you are a first-time buyer, there are some things you should know. Health care can be tough to understand. If you have never bought a coverage plan before there are some things you need to keep in mind when searching for a plan to meet your needs. Below are all of the basics you need to know when preparing to find a health insurance plan.
The Affordable Care Act has made it mandatory for all individuals to have health care coverage. If you are over 26, or not otherwise covered by a spouse or parent’s insurance plan, you must obtain coverage in order to comply with the Affordable Care Act. If you do not have health coverage, you may be fined with a tax penalty.
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Consult With an Insurance Broker
Working with an insurance broker yields a number of benefits including:
When you work with an insurance company, you are limited to what that insurance company offers. When you work with a broker, they can show you all the options from many different insurance companies. A broker will find the best plan for you for the best price.
When you’re looking for an insurance plan yourself, you generally go towards the cheaper ones. While that may seem the best way to save money, it could actually save you money by getting a better plan that covers what you need. The best part is, it doesn’t cost any extra to use a broker. Why not have someone who knows what they’re doing do the hard work for you? You can get the insurance plan you would have picked out yourself for the same price when you work with a broker. A broker is there is help you get the best plan possible and guide you through the process.
When you work with an insurance company, they try to convince you that their plan is the best for you, even if it’s not. A broker knows the ins and outs of finding health insurance plans and which companies offer the best prices. They can help you narrow down your choices and find the plan that is right for you.
Check if You are Eligible for a Subsidy
You may qualify for a tax subsidy from the federal government in order to help with some of the costs of health coverage. If you do qualify, your broker can help you choose and enroll in a health plan or you can choose to do it yourself on the Marketplace by visiting Healthcare.gov. If you don’t qualify for a subsidy, you can still choose and enroll in a health plan that meets your needs. For help choosing a health plan, contact your broker.
Choose the Health Insurance Plan That is Right For You
There are so many options and things to consider when choosing a healthcare plan. You’ll have to estimate your monthly premium costs and how often you’ll use the medical services provided by your plan. The state of Washington has developed a tier system that meets the ACA requirements. Depending on which tier plan you choose, your health expenses can be covered up to 90%. Bronze, the lowest tier, will cover 60% of your health expenses. This will leave you to pay the remaining 40%. Silver tier plans will cover 70%, gold will cover 80%, and platinum will cover 90%. As the tier level increases, so will your premium, your monthly bill.
When You Can Use Your Coverage Plan
If you buy your plan before the enrollment deadline, your plan will go into effect the beginning of the new year. This means that if you have any medical needs anytime after the beginning of the year you will have access to your coverage benefits. If you are undergoing a preventative care procedure this too will be covered. However, keep in mind that you may still have to pay your deductible before you have full access to your benefits.
Some Important Terms To Keep In Mind
Premium – Your Premium is just another term for your monthly bill.
Co-Pay – This is the flat dollar amount you must pay during a doctor’s visit. This amount remains the same regardless of the total bill.It must be paid before any policy benefit is payable by an insurance company. Co-payments do not usually contribute towards any policy Out-Of-Pocket Maximum, whereas co-insurance payments do.
Co-Insurance – Similar to a co-pay, except that co-insurance is not a set, flat amount. Co-insurance is a set percentage of the total bill that you must pay. Co-insurance comes into place after the insurance policy’s Deductible is reached, and remains in effect up until the policy’s Out-Of-Pocket-Maximum (sometimes called a “Stop-Loss”) is reached. It is expressed as a pair of percentages, with the insurer’s portion stated first.
Deductible – This is the amount of money you must spend out of pocket before your insurance will kick in with any benefits or payments. The exception to this is preventative care procedures which are fully covered, no cost to you, regardless of how much or how little of your deductible you have paid so far.
Out-of-Pocket Maximum – This is the annual limit to how much you will pay for health expenses. Once you have reached this limit, your healthcare provider will cover the rest of your healthcare costs for that year. The current OoPM in the state of Washington is $7,150 for individuals and $14,300 for families. This may be subject to change in 2018. However, your personal out-of-pocket maximum may be lower than this, depending upon which tier of coverage you have.