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How Does My Health Impact My Insurance?

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The health insurance industry was radically changed with the passage of the Affordable Care Act. Prior to the passage of this law, a person who had a health condition was typically denied insurance coverage – a financial disaster for families, many of whom were forced to file bankruptcy due to medical bills. It was a monumental change in the health insurance industry when the law came into effect – no one could be denied health insurance due to a preexisting condition.

Will My Premiums Go Up If I Use my Health Insurance?

Another advantage of health insurance is that if you use your insurance, your premiums won’t be affected. However, most health insurance companies do increase rates yearly, but you won’t be targeted due to your state of health.

Treating an Illness or Condition

Many serious diseases, illnesses, or injuries require extensive medical interventions, ongoing care, surgeries, or other expensive treatments. A longer stay in the hospital can lead to hundreds of thousands of dollars in medical bills. Your health insurance could not be more important in these situations. Insurance companies can no longer put a yearly dollar limit on what is paid out for your care. Before the passage of the law, people with health insurance would be forced to pay any amount that exceeded the limits imposed by the health insurance company, but no more.

What Are My Out-of-Pocket Costs?

Your health insurance policy has three facets that will affect your wallet:

  • Deductible: The deductible is the amount you are required to pay before your insurance takes over. This amount is yearly. The lower the cost of premiums, the higher the deductible. Younger people who are in good health typically buy a high-deductible plan, as they consider themselves less likely to need expensive medical care.
  • Coinsurance:
  • This is the amount you are required to pay for your treatments or care. You may owe 30 percent of the cost, or some other percentage, based on your plan.
  • Copay:
  • This is the amount you pay when you receive a medical service. Some services do not require a copay, under the rules imposed by the law.

Types of Health Insurance Plans

You have many options, including plans in four categories: Bronze, Silver, Gold, and Platinum. The types of plans can include:

  • EPO (Exclusive Provider Organization): These plans require you to use the medical professionals in their network, except in cases of a health emergency.
  • HMO (Health Maintenance Organization): These plans limit where you can go for treatment to medical professionals who are contracted with the specific HMO.
  • POS (Point of Service): These plans allow you to pay a lower amount for medical care when you are cared for by the medical professionals in their network. These plans require a referral from your primary care doctor if you need specialist care.
  • PPO (Preferred Provider Organization): While you will still pay less for care within the plan’s network, you can use other healthcare providers without a referral, although you will owe the additional cost.

Choosing the Right Health Insurance Plan

Choosing a health insurance plan that suits your budget can be far more difficult than expected. The information found on state or federal websites could make your head spin! Rather than wading through information that is difficult to understand, buying a policy and then being shocked by the cost of premiums or the amount you owe in copays, work closely with a local agent who can help choose the best policy for your budget, which doesn’t come with surprises.