How to Compare Health Insurance Plans

Picking a health insurance plan can be a daunting task filled with questions about the lingo, types of plans, benefits, and costs. To help make this important decision, break down your decision-making process into parts. Start by deciding what type of plan you want, and then consider what benefits are most important to you. Finally, take a look at the deductibles, monthly premiums, and out-of-pocket expenses to pick a plan that fits into your financial plan.

Method 1

Method 1 of 3:

Picking a Type of Plan

1
Choose a Health Maintenance Organization (HMO) for regular preventative care. With this plan, you’ll have to work with doctors and providers who are in the HMO’s network, but your costs will be very stable and predictable.^{[1]XExpert SourceMental Health America
Non-Profit OrganizationExpert Interview.} It’s a good plan to pick if you are concerned about preventive care, but it may not be the best option if you need to see specialists.^{[2]XResearch source}
- With an HMO, you do need a referral to see a specialist.
- For some emergencies, care from an out-of-network provider may be allowed.
2
Opt for an Exclusive Provider Organization (EPO) if you know your doctors are in-network. This plan has lower out-of-pocket expenses, but you can only see doctors, visit hospitals, and use providers who are in-network. Any care given outside of the network is 100% your financial responsibility.^{[3]XResearch source}
- In emergencies, you can visit a provider out of network, but be aware that your EPO will have to validate the emergency before they will reimburse for any expenses.
- With an EPO, you don’t need a referral to see a specialist.
Did You Know? “In-network” refers to doctors, hospitals, and providers who are contracted with a specific health insurance plan. They have negotiated rates for their services, meaning that your costs are lower and more predictable.
3
Pick a Preferred Provider Organization (PPO) to see specialists without a referral. You’ll pay less if you see providers who are in-network, but you can see any doctor and visit any hospital for an additional premium.^{[4]XExpert SourceMental Health America
Non-Profit OrganizationExpert Interview.} You also won’t need a referral from a doctor to see a specialist, which can be a great benefit depending on your health needs.^{[5]XResearch source}
- These types of plans do have a higher out-of-pocket cost because of the variety in available coverage. You’re essentially paying for flexibility.
- PPO plans are one of the most popular plan choices.
4
Select a Point of Service Plan (POS) for abundant provider options. With a POS, in-network doctors and providers are less expensive but you can see any provider you choose. You will need a referral to visit a specialist, but you get more hands-on care from your primary doctor who will help coordinate all of your appointments as long as they are in-network.^{[6]XResearch source}
- POS plans are less restrictive than HMO plans, though both require you get a referral before seeing a specialist.
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Method 2

Method 2 of 3:

Considering Benefits

1
Plan for known medical needs, like medications, specialists, and surgeries. Your medical concerns as a healthy, single 30-year old will be different from those of a diabetic mother of 3. Think about what a normal year looks like for you and do your best to predict what services you’ll regularly need.^{[7]XResearch source}
- You will, of course, need to balance your budget with your needs, but knowing ahead of time what is most important can help you make a decision when choosing a plan.
- For example, if you are diabetic and need insulin, you know that medication-coverage is important to your plan.
- If you have special allergies or immunity concerns, you may know that you spend more time seeing specialists than other people might.
2
Check if your preferred doctors are in-network for a particular plan. If there are specialists or doctors you already have established relationships with, you may not want to risk losing them by switching to a plan with a different network. You could call your doctor’s office to ask them if they are in a particular network, or you could search online for that information.^{[8]XResearch source}
- If you purchase health insurance through the Marketplace, you can check the providers in your area for eligibility by visiting https://www.healthcare.gov/find-provider-information/.
- If you are eligible for health insurance through your employment, you may not have as much of a choice about your plan and network. Meet with your HR representative to get more information about your options.
3
Make sure special treatments you need are covered by the plan. Things like physical therapy, mental health care, addiction resources, and even fertility treatments can vary from plan to plan. You can’t always predict if you will need these services, but if you think one or more of them may be important, keep them in mind when reviewing plans.^{[9]XResearch source}
- For example, if you have a child who needs to see a physical therapist once a week for an ongoing situation, having that covered by insurance could make a huge difference in your budget.
4
Verify that any medications you need are covered under your plan. When you’re looking at different plans, most have a section where you can input all the medications you need and will tell you if that specific plan covers them. Some plans offer generic versions of name-brand drugs at a much lower cost, so keep in mind that even if the name-brand isn’t covered, that doesn’t mean the plan isn’t an option for you.^{[10]XResearch source}
- If your HR representative can’t help you get the information you need or if you’re shopping for insurance on your own, you can work with a health insurance agent or use an insurance aggregator online to compare plans, benefits, and costs.
- The Health Insurance Marketplace was created by the Affordable Care Act and is an online resource you can use to find the plan that is right for you.
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Method 3

Method 3 of 3:

Understanding Costs

1
Choose a higher deductible for a lower monthly premium. The deductible is the total amount of money you have to pay before your insurance will pay for anything. The higher the deductible you choose, the more responsibility for your insurance expenses you’re assuming, so your monthly premium will be a lot lower.^{[11]XExpert SourceMental Health America
Non-Profit OrganizationExpert Interview.}
- For example, if you choose a plan with a $5,000 deductible, any medical expenses you incur will be 100% your responsibility until you’ve paid that $5,000 out of pocket. After that point, your insurance will kick in.
- On the flip-side, a lower deductible means you’ll pay a higher monthly premium.
Tip: Many plans have separate deductibles for certain types of coverages, like prescription medications. You may have a $2,000 deductible for your plan but only a $500 deductible for medications, meaning that once you’ve paid $500 out of pocket for your prescriptions, your insurance will take over those payments.
2
Opt for coinsurance to share the costs with your insurance plan. For example, if you choose a coinsurance plan of 80/20, that means you will pay 20% of the expense for a visit or procedure, and your insurance company will pay the other 80%.^{[12]XExpert SourceMental Health America
Non-Profit OrganizationExpert Interview.} For many plans, coinsurance is applied after your deductible has been met.^{[13]XResearch source}
- If your plan has a $1,000 deductible and 50/50 coinsurance, you will be responsible for the first $1,000 of medical expenses in full. After that point, you will pay 50% of all medical expenses and your insurance will pay the other 50%.
3
Verify the maximum out-of-pocket expenses you’ll be responsible for. Your insurance plan will state a maximum out-of-pocket limit that you will have to pay in a calendar year. Once you hit this mark, your insurance covers 100% of your costs.^{[14]XResearch source}
- For example, you could sign up for a plan that has a $2,500 deductible, 80/20 coinsurance, and a $5,000 out-of-pocket expense. This means you pay the first $2,500 of your medical costs. After that, you will pay 20% of any visit or procedure and your insurance plan will pay the other 80%. Once you have paid a total of $5,000, including the $2,500 you already paid for your deductible, you won’t have to cover any more of your insurance costs (other than your monthly premium) for the rest of the calendar year.
4
Pick a “metal” category that best meets your budgetary and medical needs. Each insurance plan is broken down into 4 metal categories: bronze, silver, gold, and platinum. When you select a plan on an insurance aggregator or the Marketplace, you can view each category side-by-side to see the coverage and cost differences.^{[15]XResearch source}
- Bronze plans have the lowest monthly premiums but the highest out-of-pocket expenses.
- Silver plans have slightly higher monthly premiums and slightly lower out-of-pocket expenses.
- Gold plans have higher monthly premiums and lower out-of-pocket expenses. They also have lower deductible options.
- Platinum plans have the highest monthly cost but the lowest deductibles and out-of-pocket expenses.
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Tips

Health insurance costs differ from state to state, so check out your specific area’s options to find out how much a plan will cost you and your family.
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