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Why is it that “basic healthcare” seems anything but, well…basic?
There are few topics as hard to navigate as basic medical insurance. There’s much information and technical jargon that makes finding health insurance coverage seem overwhelming.
What coverage is right for you? Is a cheap and simple plan enough? For that matter, what do healthcare terms even mean?
It feels like a lot, but it’s something you can – and should – figure out. At the very least, it’s important to know how long health insurance lasts and to understand which local plans are available to you.
Do You Need Basic Health Insurance?
YES. Even if you’re young and healthy, basic health insurance coverage is a must.
There are numerous reasons why it’s critical for you to have health coverage.
“Medical bills can be shocking,” warns Dr. Jordan Hollsten, a practicing surgeon in San Antonio, Texas. “Everything from medications to hospital fees to surgical center fees to medical equipment used must be covered. And accidents happen, as well as unexpected illness, which require care whether insurance is available or not.”
It would be nice if we could just plug “basic health insurance” into our Amazon search bar, add the top-rated option to our cart and have immediate coverage. Unfortunately, healthcare doesn’t work that way.
There are lots of different types of health insurance to consider. It’s something that is personal to you and your specific healthcare wants and needs.
What Exactly Is “Basic Health Insurance”?
The Affordable Care Act (Obamacare) guarantees basic health insurance by making sure plans provide minimum essential coverage, sometimes called “qualifying health coverage.” This is any insurance plan that meets the Affordable Care Act requirement for health coverage. Obamacare plans are designed to help protect you and your family from the cost of routine and unexpected medical expenses. Under this law, all Obamacare plans include coverage for 10 essential health benefits you’d expect – including emergency services, doctor visits, rehabilitation, maternity, and more.
Many plans encompass this basic health coverage — including private insurance, job-based plans, and Medicare — but you are not automatically enrolled in any of these. You need to find the plan that works best for you and your family and take the steps to enroll.
It should be noted, however, that not all healthcare plans provide the minimum essential coverage outlined in Obamacare. Short-term health insurance and supplemental insurance plans do not offer the same benefits.
What Are Basic Health Insurance Costs?
The total cost of health insurance can vary greatly from plan to plan. Things like your current health and the size of your family all play a part in determining what you pay out of pocket for healthcare throughout the year.
Here are a few terms to know when choosing your plan. It’s important that you consider all costs when deciding where to enroll.
Monthly Premium
Your monthly premium is what you pay each month just to have health insurance coverage. Like car insurance or a gym membership, you pay it even if you don’t have any need for medical care during the month.
Deductibles
Your deductible is the amount of money you agree to pay for treatment before your health insurance policy begins to pay. Typically a higher deductible means a lower monthly premium.
So if your deductible is $500, you’ll pay 100% of your healthcare expenses until you’ve hit $500. After you meet your deductible, you’ll be responsible for any cost sharing (copayments or coinsurance) that the plan requires.
Coinsurance
Some insurance plans may include coinsurance, which means you’ll pay a percentage of the bill even after you’ve met your full deductible. It’s a way to share the cost of your healthcare service.
Let’s say you’ve met your deductible for the year. The next time you go to the doctor, instead of paying all costs, you and your plan will share the cost. So if your coinsurance rate is 20% and the cost of a doctor’s visit is $100, you’ll pay $20 and your insurance will handle the remaining 80% of the bill.
Copayment
A copayment is a set fee you pay for a healthcare service. You might have different copayments for different doctors, hospital stays, prescription medication, and other types of care.
Your plan determines what your copay is for each service. It’s important to note that your copay can be independent of your deductible and your coinsurance.
What’s the Difference Between the Various Types of Health Insurance?
Outside of cost, there are many things to consider when you’re looking for basic medical insurance. Your age, your health history, the size of your family, and the state you live in are all factors which can affect finding the right plan.
Here’s a quick breakdown of the types of healthcare plans you may consider.
Marketplace (“on-exchange”) and Non-Marketplace (“off-exchange”) Plans
Both Marketplace and Non-Marketplace plans offer full-coverage, adhere to ACA standards and include the 10 essential health benefits. There are similarities between the two, but the key difference is whether or not you qualify for a subsidy.
- Marketplace (“on-exchange”) plans are those that are available on government websites and some price comparison sites like HealthCare.com. If you qualify for a monthly premium subsidy, then these plans will be your best option. However, not everyone qualifies for financial assistance.
- Non-Marketplace (“off-exchange”) plans are those available in the open market (outside of the public exchange environment.). There are a greater number of plans available, giving you more options.
Both of these options provide you with a metal-tiered system of coverage options: Catastrophic, Bronze, Silver, Gold, and Platinum. In general, the out-of-pocket cost for each of these tiers is higher as you go up the list, but the deductible and premiums will increase as you go down the list. It’s also important to note that different plans offer different coverage on each level, so you’ll want to compare plans carefully.
Short-Term Health Insurance
Short-term health insurance is a temporary solution to pay medical bills. It’s an option to consider if you’re between jobs, are without health insurance and are outside of the nationwide enrollment period, or are waiting for other coverage to begin.
Most short-term plans do not cover pre-existing conditions and do not adhere to the ACA standards. Short-term health insurance will typically provide some level of coverage for: doctor visits, urgent care, emergency care, and preventive care, and, maybe, prescriptions
Medicare
Medicare is a Federal health insurance program for people 65 and older, or younger people with certain disabilities. It generally pays 80 percent of your medical bills, while private Medicare Supplement and Medicare Advantage plans help cover the costs that Medicare does not pay.
How to Find Basic Health Insurance That’s Right for You
Now that you have a more basic understanding of your options, it’s time to find the plan for you.
To get started, search HealthCare.com’s database. Our online tools make it easy for you to plug in your information and compare the prices and coverage of the different plans available in your area.
