As part of your benefits enrollment at work, you may have multiple options to choose from for 2021 health insurance plans. This is an important decision for your whole family. Don’t just assume that signing up for the same option as last year is the best option. You can’t predict the future, but there’s some reasonable things you can do as you make an educated choice during your employer’s annual enrollment period that will affect your 2021 health care costs and benefits.
Do Your Homework
The brief overviews below of the different types of health insurance plans you may encounter is just that. Each employer’s offer will have nuance that requires reading the literature they provide and perhaps asking questions to an HR representative. Look for any benefits or costs before assuming an option is the best for you. Also, remember that the option you chose for the previous calendar year may not be the best for the year ahead.
Factors to consider
With your spouse, consider what these factors look like for your family in 2021. Some of these may not apply or may be more important next year compared to previous years.
Premiums (Paycheck Deduction)
This is how much money will be deducted from each paycheck to have employer provided medical insurance. 2021 health insurance rates for your family will be different for each plan your employer offers.
Out of Pocket Costs, Deductibles, and Coinsurance
Different plans your employer offers will have different out of pocket costs for health care expenses. Think of this as what you are paying for as compared to what your insurance coverage is paying for. This will vary per plan, but keep in mind this is what you will need to cover during the year. An out of pocket cost could be a $20 copay or a bill for thousands of dollars from an emergency room trip.
In Network/Out of Network
Insurance companies makes deals with certain doctors and medical facilities to be “in-network.” What this means to you is an insurance plan can establish different amounts you pay for going to an “in-network” provider vs. an “out-of-network” provider. If you have a regular doctor or pediatrician you like, be sure to check if a given plan considers the provider to be in-network. If the provider is not on the preferred list, it could mean a substantially higher cost for a visit.
Chronic or ongoing medical conditions
If someone in your family has an ongoing medical condition, you’ll want to examine the options with this lens in mind. Review each option to see how coverage works for the treatment or visits you’re likely to need. If a specialist may be needed, check the plan to see how specialist visits are covered and if there’s any additional steps the plan requires before you can go to a specialist.
If a family member has ongoing medications, check the plan to see how prescription drugs are covered.
Having a child
If you’re expecting to have a child next year, review options to see what is covered for childbirth.
If there’s an expected major procedure that might happen next year, check for coverage.
Most common types of plans
Health Maintenance Organizations (HMOs)
HMOs have a network of medical providers they work with. If you go outside the network or need a specialist, it will likely require a referral from what HMOs call your “primary care provider.” Because of the specific network or providers, HMOs sometimes have lower costs than other plans.
Exclusive Provider Organizations (EPOs)
EPOs limit care to providers chosen by the plan. In other words, providers in the network are covered and providers not in the network are probably not. There’s exceptions like emergencies, but in most cases going outside of the network means you’re on the hook for the total amount of the bill.
Point of Service (POS)
POS plans will ask you to identify a primary care provider that will be involved in your overall medical care. That provider will have to be in the POS plans network and their referral is required before you see a specialist.
Preferred Provider Organizations (PPOs)
PPOs have a network, typically larger than other plans, of providers to choose from. PPOs also allow you to see providers outside of the network with less hassle. This expanded choice comes with higher costs. When reviewing PPO plans, expect to see pricing based on in-network and out-of-network. If you value flexibility, this type of offers features like seeing a specialist without a referral.
Your employer may offer other benefits that are closely linked to your medical insurance decision for 2021. One instance is a health care account like and HSA or FSA. Certain plans will offer these accounts in tandem with a medical insurance choice. Consider the whole picture carefully and feel positive about your 2021 choices.
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