How to choose an insurance plan

• ✺The 'cheapest' plan on paper can end up costing far more over a year if you need care and face a high deductible.
• ✺Picking a plan that doesn't include your doctors can mean losing an existing relationship with a provider you trust.
• ✺Choosing well can save hundreds or thousands of dollars depending on your health needs that year.

1. 1Estimate your expected health care needs for the coming year (routine care only, or ongoing treatment/medications).
2. 2List the plans available to you and note each one's premium, deductible, copays, coinsurance, and out-of-pocket maximum.
3. 3Check whether your current doctors, specialists, and hospital are in-network for each plan.
4. 4If you take regular prescriptions, check each plan's drug coverage list (formulary).
5. 5Add up a rough total estimated cost for each plan (premium for the year plus expected out-of-pocket costs).
6. 6Choose the plan with the best balance of total cost and coverage for your situation.

Formulary

The list of prescription drugs a health plan covers, often organized into cost tiers.

HMO

Health Maintenance Organization — a plan type that usually requires using in-network providers and getting referrals to see specialists.

PPO

Preferred Provider Organization — a plan type offering more flexibility to see out-of-network providers, usually at a higher cost.

Subsidy

Financial help, based on income, that can lower your Marketplace plan premium or out-of-pocket costs.

Open enrollment

The yearly period when you can sign up for or change health insurance plans without a special qualifying event.

• ✗Choosing the lowest premium without checking the deductible and out-of-pocket maximum.
• ✗Not checking whether a favorite doctor or hospital is in-network before enrolling.
• ✗Forgetting to check whether regular medications are covered by the plan's formulary.
• ✗Missing the open enrollment window and having to wait, absent a qualifying life event.
• ✗Not checking if you qualify for a subsidy that could make a better plan more affordable.

• !A qualifying life event — like losing other coverage, getting married, or having a baby — can open a special enrollment period outside the normal window.
• !Marketplace subsidies are based on household income and size and can significantly lower what you pay.
• !Employer plans often cover a large share of the premium, which can make them cheaper overall than Marketplace options.
• !Plan details, provider networks, and prices change yearly, so it's worth reviewing even a plan you've had before.

• Compare premium, deductible, copays, and out-of-pocket maximum, not just the monthly price.
• Check that your doctors and medications are covered before enrolling.
• A plan tier like Bronze or Gold reflects the premium-versus-cost-when-you-use-care tradeoff.
• You may qualify for subsidies that lower Marketplace plan costs based on income.

Totally optional. Nobody's grading you.

1. 1.List out your expected care needs for the year before comparing plans.
2. 2.Check the HealthCare.gov Marketplace or your employer's benefits portal for available plans.

Related lessons:

• How health insurance works
• What an out-of-pocket maximum is
• How prescription coverage works

• How to pick a health insurance plan
  HealthCare.gov(opens in a new tab)
• See if you qualify for savings
  HealthCare.gov(opens in a new tab)