Choosing a healthcare plan that is a perfect fit for your needs is a very complex process which demands a lot of time, focus, and research. Yet, most people choose to spend a fraction of their day making this decision, while at the same time they would spend days figuring out the most perfect gift for their loved ones to give in the upcoming holiday season.
We understand why most people would choose not to invest a lot of their time on analyzing different health insurance plans.
There is a lot of information to process, a pressure of making the decision in a short span of time, confusion about what each aspect of the plan really means, the fear of choosing the wrong plan which would ultimately lead to losses worth thousands of dollars, and the depressing exercise of forecasting possible health issues in the year to come.
As you may have already figured out, this is a daunting task requiring certain financial skills which only a few possess. For the rest of us, we must resort to experts for guidance. Unfortunately, adequate help is not readily available, except for those working in companies with HR professionals who take care of this entire process.
The advisors available in the marketplace are able to provide insufficient information on comparative plans, and whatever information they do provide, it does not help in formulating a comparative analysis of the plans available in the market.
So, What Should You Do?
The easy way-out is to continue with the plan you are already subscribed to, regardless of whether there are better plans available in the market more suited to your needs. This is dangerous, as our plan of choice for this year may not be suitable for next year considering our changing healthcare requirements.
This is also why it is not suitable to follow your friends with the healthcare plan choices they make, as although the plans they are choosing may be best-suited to their needs, they may not be suitable for you at all.
The correct approach is to develop a model to properly assess your healthcare needs, and also all of the healthcare plans available in the market. What you are looking for is an estimate of the total spending on healthcare, which includes insurance premiums, for all plans so you may simply choose the one which is the cheapest.
The Algorithm
We don’t expect you to make a fancy Excel sheet to make an assessment of all the plans, and so we recommend the following steps which should help you pick the best plan considering your needs.
Shortlist Plans Which Cover Your Doctors
The first step is to make a list of only those plans which your preferred doctors accept, as not all doctors accept all plans. Subscribing to a plan which is not accepted by your favorite doctor will cause unease. However, bear in mind that such shortlisting will lead to an increase in cost which you ultimately pay for a plan.
Kick-out Plans with High MOOPs
The MOOP, short for Maximum Out Of Pocket costs, should not be so high that, when combined with total premiums, it makes it very difficult for you to actually pay for it.
Eliminating plans with a high MOOP will seriously help you narrow down the list. Mostly gold as well as platinum packages take the hit when it comes to eliminating plans based on their MOOP and premiums, but they offer a very low return on investment anyway.
Either Bronze or Silver
The choice will usually narrow down to silver and bronze plans, and although you may be tempted to go for a bronze plan because it sounds cheaper than the silver plan, a holistic analysis may reveal otherwise.
This analysis does not need to be tiresome; a simple overview of the medical coverage including the coverage provided for pharmaceuticals is enough to help you assess which plan is better for you.