Open enrollment season is here—the time of year when you can apply for a new health plan, or make changes to an existing one. Michigan, Ohio and Indiana residents who buy their own health insurance should review their plan to ensure they have the best possible coverage before open enrollment ends (usually by the end of January, depending on the particular health insurance plan).
Securing the right health insurance coverage now is important because it’s only during open enrollment that you can make changes to your existing coverage or opt for a new plan. Otherwise, you have to wait until you have a qualifying event such as a marriage, moving, divorce, a new baby, adopting a child, or losing coverage (i.e. termination from an employer’s plan or no longer being covered by another person’s health insurance plan).
Open enrollment is also your opportunity to meet the minimum essential health care coverage requirements of the Affordable Care Act (ACA) and to avoid the penalties for noncompliance with the ACA. The penalty for not having minimum essential health care coverage in 2016 will be $695 per adult or 2.5% of your taxable income; whichever is greater. That’s more than double the 2015 penalty!
To help you navigate open enrollment season, we’ve compiled the following guide to help you select health insurance in Michigan—and in other states, too. Check out the tips below and make a plan to get the health insurance coverage that best fits your needs:
- Protect your physical and financial health. Given the rising costs of health care and the benefits of practicing preventative care for you and your family, having adequate health insurance just makes sense. If you’ve gone without health insurance before, or you have a policy that didn’t provide the coverage you need, make this the year that you find a plan that works for you. When you think about the risks associated with not having health insurance coverage (such as the devastating financial consequences of overwhelming medical bills and the greater likelihood of serious illness from lack of regular health care) the cost of a health insurance policy is a very wise investment.
- Consider your current health status. The key to finding the right health insurance for you and your family is to consider what your needs are, based on your current health status. Start by looking at all of the medical services that you and your family use in a year and their costs. If you have a family member with an illness or medical condition which requires frequent usage of health care services, you may want to opt for a plan with lower deductibles as long as the services you plan to use are covered and the copays and co-insurance are reasonable. On the other hand, if you are lucky enough to be a light user of health care, a high-deductible plan with moderate copays may be more appropriate.
- Acquaint yourself with health insurance costs. It’s hard to determine the best health insurance value if you don’t understand how the different cost components of your policy will impact you. Simply put:
- Premiums are the monthly payments you make for the health insurance policy you choose. They are just like the premiums you would pay for any other type of insurance.
- Co-insurance allows health insurance providers to spread out the cost of your health care needs. Your insurer pays a pre-determined percentage of the cost for a given service, and you pay the balance each time you use a service. When you reach your maximum out-of-pocket cost for the year, your insurer usually pays 100 percent of any further services until the policy period ends.
- Copays are often confused with co-insurance. The difference is that a copay represents a fixed amount that you pay for certain health care services. For example, you may have a $25 copay for each visit to your physician’s office.
- Deductibles represent the fixed dollar amount that must be paid out of pocket before an insurance company will begin to cover the costs of any health care services. After the specific deductible has been met, the insurer will pay their share of health care costs, according to your policy parameters.
- Be clear about the costs and benefits of your coverage. Once you familiarize yourself with the type of costs you can expect to pay as for your health care, the next step is to ensure that you understand the specific costs of the policy you are considering and what benefits you will receive as a policyholder. Like most things in life, the cheapest option is not necessarily the best. This is especially true when it comes to health insurance. Often, if your premiums are very low, you’ll end of paying more out-of-pocket when you actually use the services covered in your policy. This may not be problematic if you don’t require health care frequently, but costs can really add up if you have a chronic condition or become seriously ill or injured. Be sure to balance the costs and the benefits of your health insurance options.
- Get the right fit with help from a health insurance professional. There are so many health insurance plans available that it can be time-consuming and challenging to compare your options and fully understand the coverage that’s available to you. That’s why it’s a good idea to work with a health insurance professional who can help you match your needs with the right policy and explain the details of cost and coverage to ensure your health care insurance and financial needs are met.
Now that open enrollment season is here, make it a priority to talk to one of our health insurance professionals. They can help you look at your options and balance the coverage you need against your budget and other considerations. One last tip—when you shop for insurance coverage, make sure the policy you choose meets the ACA requirements for minimum essential coverage so that you can avoid paying any penalties on your tax return!
Customer Service Representative, Amy Walker, works at Kemner-Iott of Cass County in our personal lines department. Amy considers herself a ‘concert junkie’ – having attended thousands of concerts and music festivals over the years. She has hiked the Grand Canyon, is an avid ‘white water rafter’, and is a proud Mom to her little boy, Brady.
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