Finding the right health plan can be difficult. Even many who work in the healthcare field are not exactly sure how health insurance works, and how to find the right plan. For those of us of the younger persuasion who may be purchasing health insurance for the first time, the task can be down right daunting. Before starting the buying process, the first thing to know is that depending on where you are in life, your health coverage search may be totally different, and the type of health insurance you get will be different. We will break down all of your options based on common life circumstances.
Before we dive into the types of health insurance available to you depending on where you are in life, you may want to consider staying on your parents plan. Thanks to a provision in the Affordable Care Act, adult children under the age of 26 can maintain coverage through their parent’s plan. If you live in the same state as your parents and they have pretty good coverage through their employers, this may be the most cost effective option It is definitely worth looking at before looking elsewhere, regardless if you are a student or at your first job.
For those who live out of state, are over the age cap, or their family's plan doesn’t make sense there are many other options available to you depending on your situation.
More than ever before, young adults are choosing to go to a college or university right after they graduate from high school. For students who may leave the state or do not have the option of staying on their parents health plan, there are a few very cost effective options available to you.
Your school may offer a student health plan, in fact, many do. For students this can be a great option that helps cover the cost of basic needs. Many students will enroll in these plans automatically during orientation in their first year and keep the plans through their time at school. Before you go ahead and enroll, let's take a minute to go over the positives and negatives.
These plans are usually lower in cost than an ACA plan, but they can have an extremely narrow provider networks that may just consist of the university clinic or university hospital. These plans will generally include basic wellness visits and offer prescription drug coverages, but have high deductibles, and may not be the best option for someone with a chronic issue or a penchant for getting hurt.
If you are working your way through school, you may be able to qualify for a subsidized ACA health plan through Healthcare.gov. ACA plans can run the gamut between a basic catastrophic plan with high deductibles and coinsurance to a very robust Platinum plan with minimal out of pocket costs, but all will offer what are known as the 10 essential health benefits. If you are earning relatively little throughout the year, you may even qualify for what is known as a cost sharing subsidy that is designed to cover roughly 94% of your medical expenses. Learn more about finding the right ACA plans here.
If you do not qualify for a subsidy though, an ACA plan may be cost prohibitive with even the most basic plans costing more than $200 a month. In the years since ACA plans have become available, the monthly premium cost has grown by double digit percentages every year except one and during this time, the options for plans has dwindled significantly with millions of Americans living in an area where only one insurer is available.
Another option that has become more popular for students is short term health insurance plans. These health plans can cost significantly less than an ACA plan or even a student plan with prices starting at around $50 a month, and can be purchased for up to 36 months depending on where you live. The reason short term plans can be more affordable is that they still rely on underwriting so if you have a pre-existing condition you may not qualify. They are streamlined insurance plans offering major medical type benefits in case of accidents and illnesses, but generally don’t cover mental health, maternity and other benefits like the ACA.
If you are already in the workforce, many of the options remain the same, but you also may have the ability to join your employer’s health plan. In the United States, employer health plans account for the biggest percentage of coverage with 49% of all citizens falling under an employer plan.
The biggest benefit of choosing to enroll in your employers health plan is that the company generally will cover a significant portion of the monthly premium, and the rest being deducted from your paycheck. You will never have to worry about making a premium payment.
Before you enroll in your employer health plan though, it is important to truly understand what the health plan is. Employers look at their entire employee population when picking the plans they will offer, and are always trying to save costs where they can. So, if you have specific healthcare needs you should take the time to ensure the plan will work for you.
The ACA required that employers of companies with over 50 employees offer health insurance benefits to their full time employees, but since most companies in the U.S. are smaller than 50, they may choose to not offer those benefits.
If you do not get coverage through your employer, you could still purchase an ACA plan, or a short term health insurance plan.
No matter how you end up doing it, you should definitely make sure you get some form of health insurance. Although the expense of health insurance can be costly, the costs associated with a medical emergency are significantly more. Medical bills are the number one reason for bankruptcy in the United States, and even the healthiest individuals can rack up tens of thousands of dollars in bills if they have an accident.
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