Choose Smart, California: A Guide to Choosing a Health Plan
Every year, the Open Enrollment period gives consumers like you the opportunity to review your health plan and make sure it meets your needs. If you’re in the market to switch plans or enroll in a new one, this guide can help you get started. Even if you’re happy with the plan you already have, it doesn’t hurt to gather and compare all of your options.
So where should you begin?
Choosing a health plan can feel overwhelming, and the plethora of information to take in can feel like you’re drinking out of a firehose. To help simplify the process, we’ve identified three components that can help you find a plan that is right for you: plan and network types, metal levels and cost of care.
- Plan and network types: HMO, PPO, POS… What do these acronyms mean?
- Health Maintenance Organization (HMO): In an HMO, you only have access to certain doctors and hospitals within its network. These types of plans tend to have lower premiums and deductibles; however, there are limited opportunities to see an out-of-network provider and out-of-network costs will generally not be covered. HMOs also typically have more coverage restrictions, only allowing a certain number of visits, tests or treatments.
- Preferred Provider Organization (PPO): This plan gives you the most freedom when navigating the healthcare system. Like HMOs, they also offer a network of providers, but they differ in that PPOs have fewer restrictions on seeing out-of-network doctors. In general, these types of plans provide more flexibility and greater coverage, but typically come with higher premiums and deductibles.
- Point of Service (POS): Think of a POS like a hybrid of an HMO and a PPO. A POS plan is a type of managed care plan that has a designated network but offers some flexibility in seeking care out-of-network. Note that unless your primary care provider has made a referral to an out-of-network provider, you will likely have to pay out-of-pocket for all care out-of-network.
- The “metal” levels: In addition to choosing a plan type, “metal” levels represent how you and your insurance plan split costs, and how these costs are distributed:
- Bronze: Lowest monthly premium, but highest costs when you need care. You’ll also have to pay for most routine care yourself, so this category would work if you don’t need care frequently, but want a low-cost way to protect yourself from worst-case scenarios.
- Silver: Moderate monthly premium, and moderate costs when you need care. This option may work better if you’re willing to pay a slightly higher monthly premium to have more of your routine care covered.
*If you qualify for cost-sharing reductions, you must pick a Silver plan to get the extra savings.
- Gold: High monthly premium, but low costs when you need care. If you require frequent health care, this option could work best for you. You’ll pay more each month to have more of your costs covered when receiving medical treatment.
- Platinum: Highest monthly premium, but lowest costs when you need care. This category also has the lowest deductibles, meaning your plan starts paying its share earlier than the other categories. If you usually use a lot of care, and are willing to pay a high monthly premium, nearly all out-of-pocket costs will be covered.
*Metal categories have nothing to do with quality of care.
- Your cost of care: Once you’ve chosen a plan type and metal category that best fits your needs, it’s time to calculate the expense of the plan. You have to consider other costs, besides your monthly premium, especially since they may be higher than your premium itself.
- Deductible: The amount you must pay for health services before your insurance starts to pay.
- Copayment: A fee you pay each time you see a doctor or fill a prescription.
- Out-of-pocket maximum: The most you have to pay for health services. Once you have paid this amount, your insurance pays 100% of your health care costs.
For a larger glossary of terms to know, check out our Choose Smart California checklist. Finally, if you want to compare and contrast a few different plans, Healthcare.gov offers a preview that allows you to check out prices before enrolling.
My Patient Rights is here to help during Open Enrollment – and every day!