Will I Be Able to Afford the New Coverage?
Typical concerns when getting new insurance coverage are:
- How expensive will it be to get my own individual policy?
- The deductibles seem too high to be worth getting insurance
- How much will I have to pay after I meet the deductible?
- Is a Health Savings Account (HSA) worth it?
Individual insurance will not cover pre-existing conditions, but that is what makes it so inexpensive. So the price difference may be worth your while to not have a minor pre-existing condition covered if you can still get approved. For example, a condition like asthma or allergies are typically the most annoying "minor" conditions that people try to weigh the pros and cons for. If you have asthma, your inhaler or medications may cost you $100/month, but getting an individual insurance policy that excludes your asthma may save your family $200/month in premiums. In this case it's a good idea to find a knowledgeable broker to determine the best course of action and find the best insurance company for your underwriting situation.
Getting a health insurance plan with copays is usually more expensive than it's worth, i.e. - you'll usually pay more in premium than you'll get in benefit from the policy. Even if you go 2-3 times per year to the doctor, you might save $185 by having the copays, but you'll pay an extra $320 in premiums to get the copays. A policy like a high deductible health insurance plan that applies doctors visits and prescriptions to your deductible is usually a better way to spend your insurance dollar.
Cost of an Individual Health Insurance Policy
It's usually worth it to get a higher deductible when picking an individual health insurance plan. Doing this can save you $1000 - $2000 in premium per year, while you might only save $1000 in the deductible. This makes sense because the premium is a guaranteed expense and the deductible isn't. After the deductible, you are responsible for the coinsurance. This is the amount that you will split with the insurance company. The most common coinsurance is 80/20 (you pay 20%), there will never be a coinsurance where you have to pay more than 50%. There is usually a limit to coinsurance (except for indemnity plans like MEGA or Alliance), the limit is usually $10,000. That limit is the total between you and the insurance company, so an 80/20 plan with a $10,000 coinsurance limit means you would pay $2,000 more after your deductible and the insurance company would pay the other $8,000. After you reach the coinsurance limit, the insurance company pays 100% to the policy maximum.