If your employer doesn't provide you with health insurance, or if you are self-employed, you can still purchase an individual health insurance plan through the health insurance marketplace for your state. When it comes to picking an individual health insurance plan, you should be aware of all the different costs that come into play.
Premium is Your Monthly Cost
When you purchase health insurance, you are going to have to pay a premium. You can pay your entire premium for the year all at once, or you can pay your premium on a monthly basis. With health insurance, your yearly premium cost will be split into monthly payments. This is essentially what you pay in order to maintain healthcare coverage. You pay your premium regardless of if you use your health insurance or not.
Copayment is What You Pay When You Use Your Insurance
When you go to the doctor, you will have to pay a copayment. This is the amount that you are expected to pay towards your own healthcare. Generally, your doctor will collect the copayment from you at the time that you get care. You generally have to pay a copayment for all care except for preventative services. With some health insurance plans, you pay your copayment until you reach your maximum out of pocket amount, and with other plans, you always pay a deductible.
Deductible is the Amount of Your Health Insurance You Cover
When you look at health insurance plans, pay attention to the deductible. The deductible is the money you will pay for your bills before your health insurance provider will start to pay your medical bills. It is generally advisable to get a lower deductible if you know that you have a lot of healthcare needs, so that way your insurance will start picking up the balance sooner. If you don't' have a lot of healthcare needs, it can make sense to go for a higher deductible, which can lower your premium.
Your out of pocket maximum is the maximum amount of money that you will pay for your healthcare each year. This number is different than your deductible, as it includes all the money you pay towards your healthcare outside of your premium. You will never have to pay more than your out-of-pocket maximum towards your healthcare.
It is important to understand all the costs associated with healthcare so you can accurately compare the various costs across different healthcare plans and choose a healthcare plan that fits your budget.Share