How to choose a health insurance plan during open enrollment
Is your health insurance still the right fit for you? Open enrollment is your chance to review your coverage and decide whether to keep your current health plan or choose a different one. Even if you are happy with your plan, it is worth taking another look. Your health needs, medications, doctors and finances may have changed since you last enrolled. Health plans can change too. A doctor may leave a network, a medication may be covered differently or your premiums and other costs may increase. Here is what to review before making your open enrollment decision.
WHAT IS OPEN ENROLLMENT?
Open enrollment is a set period when you can sign up for health insurance or make changes to your current coverage. The timing depends on where you get your insurance. You may have coverage through: An employer, The Health Insurance Marketplace, Medicare, Another type of health plan, Enrollment dates and rules may vary, so check the information provided by your employer, insurer or government program. Outside of open enrollment, you may be able to make changes after certain life events. These may include getting married or divorced, having a baby, losing other health coverage or moving to a new coverage area. Health plans can change too. A doctor may leave a network, a medication may be covered differently or your premiums and other costs may increase. Here is what to review before making your open enrollment decision.
START WITH HOW WELL YOUR CURRENT PLAN WORKED
Before comparing new options, think about your experience with your current plan. Ask yourself: Were my doctors and other health care providers in-network? Were my regular medications covered? Did I have trouble getting care or services approved? Were my out-of-pocket costs manageable? Did I pay for benefits I rarely used? Did I put off care because of the cost? Do I expect my health needs to change next year? Reviewing the past year can help you see what worked and what did not. But do not simply choose the same plan because it is familiar. Plan costs, networks and benefits can change from year to year.
THINK ABOUT THE HEALTH CARE YOU MAY NEED NEXT YEAR
You cannot predict every illness or injury. But you may already know about some likely health care needs. Consider whether you or a covered family member may need: Regular primary care visits, Specialist care, Prescription medications, Therapy or mental health care, Physical or occupational therapy, Lab tests or imaging, A planned procedure or surgery, Pregnancy and maternity care, Medical equipment or supplies, Also think about new diagnoses or changes in existing health conditions. Looking at the care you used during the past year can be helpful, but do not assume next year will be exactly the same.
CHECK WHETHER YOUR DOCTORS AND FACILITIES ARE IN-NETWORK
A health plan’s network is the group of doctors, hospitals and other health care providers that have agreements with the insurer. Before choosing a plan, check whether it includes: Your primary care provider, Specialists you see regularly, Your preferred hospital or health system, Labs and imaging centers you use, Mental health providers, Pharmacies, Do not rely only on whether a doctor accepted the plan in the past. Networks can change. You may want to check both the insurance company’s provider directory and the provider’s office. Ask about the specific plan, not just the insurance company, since one insurer may offer several different networks.
MAKE SURE YOUR MEDICATIONS ARE COVERED
If you take prescription medications, review the plan’s formulary, or list of covered drugs. Check: Whether each medication is covered, What drug tier it is in, What you may pay, Whether there are quantity limits, Whether prior authorization is required, Whether you must try another medication first, Which pharmacies are preferred or in-network, Do not assume a medication will be covered the same way next year just because your insurance company is the same.
COMPARE MORE THAN THE MONTHLY PREMIUM
It is easy to focus on the amount that comes out of your paycheck or bank account each month. But the plan with the lowest premium is not always the least expensive overall. Look at the full picture.
- Premium
- Deductible
- Copays
- Coinsurance
- Out-of-pocket maximum
Your premium is the amount you pay regularly to keep your insurance coverage.
Calculate your premium cost for the full year.
COMPARE WHAT YOU MIGHT PAY IN A TYPICAL YEAR AND A HIGH-COST YEAR
One way to compare plans is to consider two different situations.
A typical year
Estimate:
- Your annual premiums
- Regular doctor visits
- Medications
- Planned treatments or services
- Other health care you reasonably expect to need
A high-cost year
Look at:
- Your annual premiums
- Your deductible
- Your out-of-pocket maximum
- How much you could afford to pay unexpectedly
A plan may look affordable when you compare premiums alone but be harder to manage if you need surgery, hospital care or ongoing treatment.
The goal is not to predict exactly what you will spend. It is to understand both your likely costs and your financial risk.
Understand the type of plan you are choosing
Health plans can differ in how much flexibility they give you.
Depending on the plan, you may need to consider:
- Whether you must choose a primary care provider
- Whether you need referrals to see specialists
- Whether out-of-network care is covered
- How large the provider network is
- Whether you need approval before certain tests, treatments or procedures
Do not choose based on the plan label alone. Review how the specific plan works.
Think carefully about a high-deductible health plan
A high-deductible health plan (HDHP) may have lower monthly premiums but require you to pay more yourself before the plan begins sharing more of your health care costs.
An HDHP may also allow you to contribute to a health savings account (HSA).
This type of plan may be a good fit for some people but not others. Consider your expected care, savings, employer HSA contributions and ability to handle an unexpected medical bill.
Review FSA or HSA options
Open enrollment may also be the time to decide how much money to set aside for health care expenses.
Depending on your eligibility and plan, you may have access to:
- A flexible spending account (FSA)
- A health savings account (HSA)
These accounts have different rules about eligibility, contributions and what happens to unused money.
Think about expenses you may have for:
- Deductibles
- Copays and coinsurance
- Prescriptions
- Dental care
- Vision care
• • Other eligible health expenses
An HDHP may also allow you to contribute to a health savings account (HSA).
This type of plan may be a good fit for some people but not others. Consider your expected care, savings, employer HSA contributions and ability to handle an unexpected medical bill.
Look beyond medical coverage
Your open enrollment choices may include more than your main health plan.
Depending on what is available to you, review:
- Dental coverage
- Vision coverage
- Mental health benefits
- Prescription coverage
- Telehealth
- Physical therapy and rehabilitation benefits
- Maternity care
- Health savings options
- Other supplemental benefits
Do not assume that a benefit works the same way from one plan to another.
For example, check whether there are limits on visits, network requirements or prior authorization rules.
Questions to ask before you enroll
Before making your final choice, ask:
- Are my doctors, specialists and preferred hospitals in-network?
- Are my medications covered?
- What will I pay in premiums for the full year?
- What is the deductible?
- What are the copays and coinsurance?
- What is the out-of-pocket maximum?
- How are specialist visits covered?
- Do I need referrals?
- Is out-of-network care covered?
- What services need prior authorization?
- Am I eligible for an HSA or FSA?
- Does my employer contribute money to an HSA?
- Can I afford the plan if I have an unexpected high-cost medical need?
Keep plan documents or screenshots of the information you used to make your decision.
The bottom line
Open enrollment is not just a time to pick the plan with the lowest premium or keep the coverage you already have.
Review how well your current plan worked, then think about the care you may need next year. Check provider networks, medication coverage, premiums, deductibles and out-of-pocket limits.
The right health plan is the one that offers the best balance of coverage, cost and financial risk for you and your family.
Your premium is the amount you pay regularly to keep your insurance coverage.
Calculate your premium cost for the full year.
Your deductible is the amount you generally pay for covered care before your insurance begins sharing more of the cost.
A lower premium often comes with a higher deductible, but not always.
A copay is a set amount you pay for certain services or medications.
For example, you might have different copays for a primary care visit, specialist visit or prescription.
Coinsurance is the percentage of a covered cost you pay, often after meeting your deductible.
For example, if your plan pays 80% of a covered service, you may pay the remaining 20%.
The out-of-pocket maximum is the most you pay for covered in-network care during the plan year.
Your premiums generally do not count toward this limit. Other costs may not count either, so check your plan details.
The out-of-pocket maximum can be especially important when comparing your financial risk if you need a lot of medical care.
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