The last spring break of your college career is over, classes are wrapping up and graduation day is near. It’s time to start thinking about the next chapter in life where you will need a place to live, income and health insurance.
While buying a healthcare plan might be low on your priority list, it shouldn’t be. Accidents are the number one cause for doctor’s visits and hospitalization when you are between the ages of 20-35. Adding a $10,000 hospital bill on top of your student loan debt could be financially catastrophic. This is when health insurance can help.
Anyone under the age of 26 can stay on or return to their parent’s healthcare plan, but that’s not always the most economical solution. For those who need to buy health insurance on their own, there are right ways and wrong ways to go about buying a plan.
Here are five quick tips that will make the task of shopping for a healthcare plan easier and more affordable.
- Comparison shop.Most individuals have approximately 30 health insurance plans to choose from, so it’s important to line plans up and compare monthly cost, and out-of-pocket expenses that come from deductibles, copays and things like coinsurance.
TIP: If you are healthy and don’t need more than preventive services each year, you might be fine with a lower cost, high deductible plan. If you have a chronic illness like Type 2 diabetes, it’s wise to look at healthcare plans that have more medical benefits.
- Research the terminology. What is “coinsurance?” Most people don’t know the ins- and outs of insurance speak, which can be financially detrimental when surprise medical bills arrive.
TIP: When comparison shopping, do your homework and figure out the terminology. Then total up the cost of everything you would have to pay out of your own pocket, should you have an accident, which can include payouts for your deductible, coinsurance and copays.
- Check the health insurance company’s doctor and hospital network.Provider networks vary in size from plan to plan, and they can change each year. The insurance company you are considering should be able to tell you if your doctor is “in-network.”
TIP: Remember to ask if your doctor is in plan’s network, not just the clinic that he or she may practice from. Sometimes a clinic may be in the plan’s network, but the doctor you wish to see is not.
- See if you qualify for financial benefits.If you are under the age of 30, you are eligible to purchase a Catastrophic plan, which has a high deductible but a low monthly rate. They are not eligible for subsidies but can be a cost-effective option. However, if you are making a little money, you could be better off checking to see if you qualify for a subsidy to help pay the monthly cost of your healthcare plan. Many times individuals who make a little cash can get huge financial benefits for a regular health plan, sometimes paying less than $50 a month.
TIP: Check this subsidy calculator to find out if you qualify for a subsidy on your health insurance costs.
- Get covered.The Affordable Care Act, also known as Obamacare, requires that all Americans must carry health insurance coverage. Failing to buy a healthcare plan can result in a fine of $325 per person or 2% of your income for 2015, whichever is higher! The fine is applied to your income taxes, so if you expect a refund every year but don’t have health insurance, you could wind up paying Uncle Sam a chunk of cash.
TIP: While paying a fine might be the cheapest option right now, the fine goes up to $695 per person in 2016, or 2.5% of your income. Plus, not having healthcare coverage can result in even bigger expenses should you become ill or get into an accident.
This information is courtesy of HealthCare.com, the nation’s leading health insurance search engine and comparison tool.