How much will I pay?
This question has been lurking behind most of the questions on this list. You can only consider doctors and benefits for so long before you start to wonder, "How much is this going to cost me?"
Let's talk about a few of the terms that are important to know:
- The premium is the payment you make in exchange for your insurance.
- The deductible is the amount you must pay out of your own pocket for health care each year before the insurance company takes over the costs.
- A co-pay is a fixed payment you'll make each time you see a doctor.
- Coinsurance is a payment based on the percentage of costs of a doctor's visit or a hospital stay; for example, if your plan has 70/30 coinsurance, you'll pay 30 percent of the medical bills while your insurance company would pay 70 percent of them (after you meet your deductible).
- The out-of-pocket limit is the maximum amount you would have to pay in a given year, minus the premiums -- in other words, the combination of the deductible, the co-pays and coinsurance. Be wary of a plan that doesn't have such a limit.
You'll want to keep an eye on the kinds of co-pays and coinsurance agreements you're signing up for, but the key issue is balancing your premium and your deductible. The higher the deductible, the lower the premium. But don't just agree to a high deductible in order to get a break on those monthly premiums; if you had an accident or got sick, then the out-of-pocket costs might prove insurmountable. If you have a young family, which requires many doctor's visits, or if you're middle-aged and worrying about your health, then higher premiums may be worth the trade-off of a low deductible. Younger people, however, may only see a doctor once or twice a year, so they could save a little money by selecting a high deductible and hoping for a trauma-free year.