Well, it’s that time of year again, and if you’re like me and you rely on the Healthcare Marketplace for your health insurance, once more unto the breach. It can be a confusing and exhausting experience trying to choose a health plan from all that the Marketplace can offer, but I just did it and I’m here to help you navigate the process a little more easily.
Here’s what you need to know.
1. Always start with your healthcare credits
Don’t skip the part where you give the website your income and tax information, because this step can save you plenty. Even if you think you make too much to qualify for any kind of tax credits, you may well be surprised.
Since these immediately reduce your premium, rather than your having to wait to use them on your tax return, they’re incredibly helpful to have calculated correctly. Every health plan you look at will have its premiums displayed based on your credits.
This way, you can plug your new health plan information directly into your budgeting app, and be prepared for what your costs will be in 2025. If you don’t have a budgeting app that you already like, check out our curated list of budgeting apps that get the Motley Fool Money stamp of approval.
2. Use the filters to help narrow your options
Beyond knowing your costs, you have to choose a health plan that will cover your actual doctors. This can be tricky, I know. Where I live now, there are only three healthcare systems, which makes it a lot simpler, but when I lived in Dallas-Fort Worth, there were dozens of options. Using the filters will help you see which doctors and systems potential health plans will cover, so you don’t end up with your own doctor outside of your healthcare network.
This mistake can cost you thousands of dollars and make your healthcare plan pretty worthless at doing its job. So, always, always make sure each and every doctor you must see is covered before you sign up for your health plan.
3. Understand your healthcare costs
There are a few elements to your healthcare costs that you need to understand, and how those interact will affect what you pay for healthcare this coming year. These are your:
- Deductible
- Out-of-pocket maximum (OOP)
- Copays
- Coinsurance
Your copays and coinsurance are essentially how much you pay every time you go to see any kind of doctor. They don’t usually kick in until you’ve met your deductible — meaning that you’ve spent a specific amount on healthcare — but I did notice a few plans this year that specified that copays and coinsurance start immediately, so read all of this carefully. Copays and coinsurance apply to pharmacy benefits as well as medical benefits.
The other thing to know about is your out-of-pocket maximum. This one is the most important element for me, because I’m on a medication that’s incredibly expensive. So, I always try to match my OOP with my medication, so it doesn’t take very long to reach it. Once you’ve met your out of pocket maximum, that’s it — that’s all you pay for care as long as you’re in network.
Need three eye surgeries and a peg leg? No problem. It’s all covered in-network once you’ve met your OOP.
The one thing to remember in all of this is that if you have a low deductible and a high OOP, it can take a very long time to reach that OOP, since you’ll be paying a significantly reduced amount toward it once your deductible is covered. If you don’t think you’ll meet your OOP, a low deductible makes the most sense, but if you’re like me, a higher deductible might be a better answer.
It’s marketplace time, go find the plan for you
I think that Marketplace season is about the most intimidating time of the year, because the decision you make now can seriously affect you for the next year. Although it’s just a year, if you have heavy healthcare needs, it could amount to a costly mistake if you make the wrong call.
If you can’t decide for yourself, there are often local insurance professionals just waiting for you to call them. They don’t charge for their services (the insurance company pays them), and they can help you navigate your needs and wants for your healthcare.
Working with an insurance expert also means you can do other things like pick up a life insurance plan (or choose one from our curated list here), change your car insurance, and find cheaper homeowners or renters insurance.
