Canopy Nation Blog

Health plans vary and have their own sets of benefits and drawbacks related to coverage, physicians, copays and premiums, among others. You’ll need to compare the different types of health insurance plans and choose the one that best fits your needs and budget. It’s important to note that the most suitable plan will depend on your personal health, family’s health and financial situation. There are a few main points of differentiation for health insurance plans. For one, some plans require you to have a primary care provider or have health services pre-authorized. Other plans have requirements to obtain a referral to see a specialist or whether you have to file insurance claims. Some plans pay for out of network health care, and others do not. One of the biggest differentiators is how much cost sharing (e.g., deductibles, copays and coinsurance) you’re responsible for paying when you use your health plan. Health Maintenance Organization (HMO) Plans An HMO plan typically has low premiums and deductibles with fixed copays for doctor visits. While cheap, HMO plans require the selection of only in-network providers. When you sign up for the plan, you’ll select a primary care provider (PCP) for your routine checkups. Your PCP will need to give you a referral before you can see a specialist, such as an allergist or dermatologist. HMO plans are generally most feasible if you don’t have many specific medical issues or needs. Although they are restrictive compared to other options, these plans tend to be the most cost-effective. Preferred Provider Organization (PPO) Plans PPO plans have pricier premiums than HMO plans, but they allow you to see specialists and out-of-network providers without referrals. Out-of-network care typically comes with greater employee cost sharing, but in-network copays and coinsurance are generally low. More paperwork is typically involved with this plan if you see out-of-network providers. A PPO plan could be ideal if you’ll need more health care or flexible options in the coming year, but you can afford higher premiums. Point-of-Service (POS) Plans A POS plan is a hybrid of an HMO and PPO plan. This plan allows you to choose whether to use HMO or PPO services each time you receive health care. For slightly higher premiums than an HMO plan, a POS plan can cover out-of-network doctors. As such, it’ll be more beneficial and cost-effective if you initially see a PCP and seek in-network care instead of not first seeing a PCP for a referral. A POS plan could be a good fit if you prefer out-of-network care but also want a PCP coordinating your regular care. Exclusive Provider Organization (EPO) Plans An EPO plan offers moderate freedom to choose your health care providers. Like HMO plans, EPO plans only cover in-network care; however, they typically don’t require specialist referrals from PCPs. Premiums are generally higher than those of HMO plans, but lower than PPO plans. An EPO plan may make the most sense if you don’t mind having a limited number of doctors and facilities and would rather not have to get a referral to see a specialist. High Deductible Health Plans (HDHPs) An HDHP can be designed as an HMO, PPO, POS or EPO plan. These plans have low premiums, but higher immediate out-of-pocket costs. An HDHP is often paired with a health savings account (HSA). An HSA is a tax-advantaged account used to pay for qualified medical expenses. An advantage of an HSA is that the remaining funds at the end of the plan year can be rolled over into the account for the following year. An HDHP might be a good option if you don’t need much medical care. As such, this type of plan is popular among young and healthy adults but could be costly to older adults or young families. Health insurance regulations vary by state, so be sure to read the fine print on each plan you consider before enrollment. It’s also likely that employer-offered plans could be more or less expensive based on certain factors. When comparing health plan options, consider your health, unique needs and financial situation. It’ll also be necessary to review costs, flexibility, coverage and convenience when making your decision. If you have more questions about health plans, contact your HR director.

Health insurance may be one of the most critical annual purchases you undergo since it can impact your physical, mental and financial wellness. Unfortunately, selecting a health insurance plan can feel overwhelming. With so many options, it can also be easy to make a mistake when selecting coverage. We explore six common missteps related to selecting a health insurance plan. Avoid these mistakes and you’ll be ready to choose the best plan coverage for your situation. 1. Rushing through enrollment options Many people rush when buying their health insurance or only rely on recommendations from friends, family and coworkers. Others may simply re-enroll with last year’s choices. But health insurance provides personal coverage, so it’s important to research and find what will work best for your health needs and budget. When it comes time to enroll in a plan, compare different policies and understand their coverages and associated costs, such as premiums. One of the best ways to ensure the policy is right for your health needs is to consider your medical requirements and spending in the next year. Don’t forget to confirm in-network coverage to ensure your preferred doctor, clinic and pharmacy are connected in the new plan. Then, you can find the most suitable plan and coverage in an effort to simplify your health care and make it more affordable. 2. Overlooking policy documents Another common mistake is skipping through or not thoroughly reading the policy’s terms and conditions. However, carefully reading a policy is the best way to know what to expect from the health plan and what the plan expects of you. As such, read the fine print on each plan you consider before enrollment. Reviewing the policy’s inclusions and exclusions will help you make an informed decision and potentially avoid surprise bills later on. 3. Misunderstanding costs A cost-sharing charge is an amount you must pay for a medical item or service covered by the health insurance plan. Plans typically have a deductible, copays and coinsurance. Here’s what those terms mean: The deductible is the amount you pay out of pocket before your health insurance starts to cover costs. A copay is a flat fee you pay upfront for doctor visits, prescriptions and other health care services. Coinsurance is the percentage you pay for covered health services after you’ve met your deductible. When shopping for a plan, keep in mind that the deductible is tied to the premium. As such, a low deductible plan may seem attractive, but understand that it generally comes with a higher premium—and vice versa. Consider keeping your deductible to no more than 5% of your gross annual income. When shopping for a plan, look closely to see when you’ll have a copay and how much it will cost for various services. 4. Concealing your medical history It may be tempting to avoid sharing your medical history if you’re worried about being rejected or receiving higher premiums. However, it could hurt you in the long run when insurance claims are denied for existing conditions or undisclosed medical information. 5. Ignoring add-ons Health insurance add-ons are often included separately and require an additional premium, which means many people don’t look at them. A standard health insurance plan may not cover certain situations, so reviewing all available options is essential. An insurance add-on could help bolster your overall health insurance coverage by offering extra protection. Review the add-on covers offered with your health insurance policy. See if any would be helpful for you, your family or your plans in the next year. For example, some common add-ons include critical illness insurance, maternity and newborn baby insurance, hospital daily expenses and emergency ambulance services. 6. Selecting insufficient coverage People may hold back on purchasing certain coverage to pay a lower premium. While that may seem advantageous in the short term, you’ll be on the hook for out-of-pocket costs when facing a medical emergency. This mistake may be accompanied by physical, mental and financial health consequences. When selecting a plan, check that the policy provides adequate coverage for your medical needs and other essentials. The right health insurance can take care of yourself and ensure financial security. Health insurance is an essential investment for you and your family. As we near the 2023 open enrollment period, be sure to avoid these common mistakes while buying health insurance, and you’ll be better informed to enroll in a plan and other coverages. Health care costs continue to rise, so it’s more important than ever to carefully review available policies, consider your options and health needs, and, ultimately, select the best plan to protect your health and finances. If you have more questions about health plan options, contact your human resources director or our team at CanopyNation.