5 Things to Consider When Comparing Health Insurance Plans

Picking a health insurance plan shouldn't be difficult. But if you're doing it right, it often is.

Weighing monthly premiums and out-of-pocket costs can help to pick the best plan for you.

The White House hopes that 9.1 million people will sign up for health insurance coverage through state and federal Affordable Care Act marketplaces during open enrollment, but the Congressional Budget Office estimates that closer to 13 million will. Millions more will consider plans offered by their employers during their own open enrollment periods.

There are countless plan options, numerous carriers and a health insurance vocabulary that can seem like a foreign language. But by learning about the most important factors to consider when comparing plans, you can approach the situation with some confidence and have a greater chance of ending up with a plan that's perfect for your health care needs.

1. How much is your monthly premium?

Your health insurance premium is the price you pay, typically on a monthly basis, for your coverage. Determine how much you can afford to spend on your policy so you can narrow down your choices. This consideration is a no-brainer, but it's often the first and only thing people look at when choosing a plan. Unfortunately, a lower premium doesn't always mean lower medical costs overall, and it's likely only one of many expenses you'll have.

2. What are your medical needs for the coming year?

Estimating how often you'll have to see the doctor or whether or not you'll require any surgeries and hospital stays may seem difficult. It's true, there's a certain amount of medical care that's unpredictable. But calculating how often you see a doctor, on average, or whether or not a chronic condition will send you to a specialist or hospital will help you determine which plan's features will best cover you.

3. How much do you want to pay out of pocket for services?

Cost-sharing is a term applied to the various items you and your insurance carrier will share the cost of. This includes deductibles, copayments, coinsurance and out-of-pocket maximums. These plan features are a frequent point of confusion. So what are they?

A deductible is the dollar amount you must spend before your insurance provider contributes. Sometimes insurance plans will allow a certain number of regular doctor visits or prescriptions outside of the deductible; for those, you'll pay a copay instead. A copay is a fee that you pay for certain services. For a doctor's visit, it's usually around $15 to $30.

Coinsurance, on the other hand, is a percentage of your bills that you'll have to pay - normally after you've met your deductible and before you reach your out-of-pocket maximum. If your coinsurance is 20 percent, the health insurance company will cover the remaining 80 percent of your medical bills.

The out-of-pocket maximum is a cap on the amount of money you'll have to spend in the coverage year. Once you reach this cap, your insurance company will pay 100 percent of covered in-network services.

4. Do you take regular prescriptions?

Under the Affordable Care Act, all health insurance plans must have some prescription drug coverage. It's one of the health law's 10 required essential health benefits. But the scope of this coverage varies considerably.

If you take any prescriptions on a regular basis, check if the plans you are considering have your drugs listed on their formulary, which includes all drugs covered by an insurance company. They may only cover one drug from each category, so if you depend on a specific pharmaceutical, it's important they list it.

5. Is your doctor included in the network?

All insurance companies have a network of doctors and medical facilities that they work with. If you visit someone who's out of network, they may not cover the entire cost and could deny your claim altogether. Make sure your regular medical providers are in the network you choose, unless you're willing to find a new doctor.

Also, it's important that your insurance plan covers a good mix of facilities and providers in your geographic area. Having to drive an hour in pursuit of medical care is not only inconvenient, but could be dangerous or even impossible in the event of an emergency.

Choosing one health insurance plan among the array of options can be difficult. But you're not alone. As millions shop for new coverage, helpful resources are often a click away.