You’ve just started a new job, and it’s time to choose a new healthcare plan. Your employer is offering you several plans to choose from. Here are some things to consider when you are trying to choose the right healthcare plan when you are starting a new job.
Start by reviewing the features of each healthcare plan, and then base your decision on a side-by-side comparison of the features of each plan. Then choose the one that best fits your needs. Key factors to consider include deductibles and out-of-pocket costs, whether the plan includes a health savings account, your status as an employee, health insurance networks, your family status, and your age.
Deductibles and Out-of-Pocket Costs
A lot of words are thrown around when choosing and discussing healthcare plans, and it’s important to understand what they mean. A deductible is an amount defined by your insurance provider. It’s how much you pay for your healthcare services before your insurance provider steps in. If your deductible is $1,000, you’ll have to cover $1,000 of your medical expenses, and then you’ll most likely only pay a copay for those covered services and your insurance covers the rest.
Out-of-pocket costs include your deductible, and they also include the cost of all services that aren’t covered. It’s important to analyze the relationship between your new salary and the out-of-pocket costs you may have. Analyze what you’ll be able to afford if you have a medical emergency.
Health Savings Account
A Health Savings Account, or HSA, is a hybrid between a high-deductible health insurance and a tax-favored savings account. Benefits of an HSA include less expensive health insurance, tax-free withdrawals, and tax-deferred interest earnings. Plus, unused money in your HSA isn’t forfeited at the end of the year. It continues to grow! However, you may pay higher out-of-pocket costs at first.
Employees that are higher up on the “corporate chain” may be able to renegotiate presented healthcare plans. If you have a higher-paying or higher-status job, and you aren’t happy with your current options, try discussing other options with your company.
Health Insurance Networks
Some health insurance policies have networks and won’t cover services provided out-of-network. If you’ve got a preferred doctor or specialist you or your family sees, make sure they are in the network of the healthcare plan you’re thinking about. If not, you may want to either switch plans or find a new medical provider.
Family Status and Age
Your family status, and whether you are single, married, and/or a parent, all influence what healthcare plan you might choose. Your personal health also influences your choice. If you frequently visit the emergency room, are expecting or want to be expecting a child, or you have a planned surgery upcoming, you may want a plan that has higher premiums but better coverage. If you’re close to retirement age, you may want to look at insurance plans that benefit retirees.