What to have ready before you compare health plans

Why isn’t the cheapest plan always the cheapest?

Every health plan has a few costs that work together. Here’s what they mean in plain words:

• Premium: what you pay each month to have the plan, even if you never see a doctor.
• Deductible: the part you pay for covered care before the plan starts to pay its share.
• Copay or coinsurance: your share of a bill after that. A copay is a set amount per visit. Coinsurance is a percent of the bill.
• Out-of-pocket maximum: the most you’ll pay for covered care in the network in a year, not counting your monthly price.

Say Plan A costs $300 a month with a $6,000 deductible. Plan B costs $450 a month with a $1,500 deductible. To keep it simple, say each plan pays the rest after the deductible.

If you barely see a doctor all year, Plan A costs less. You pay $3,600 in monthly prices, and Plan B would have cost $5,400.

Now say you need a $5,000 surgery. With Plan A, you pay $3,600 plus $5,000, for $8,600. With Plan B, you pay $5,400 plus $1,500, for $6,900. The plan with the higher monthly price comes out ahead.

The out-of-pocket maximum is your worst case. Say yours is $8,000, and a hospital stay runs $60,000 in covered bills. You’d pay up to $8,000, and the plan would usually pay the rest.

Who are your doctors, and what do you take?

Your doctors

Each plan has a network. That’s the doctors, hospitals, and clinics that have agreed to work with it. Seeing someone outside the network can cost a lot more. Some plans don’t pay for it at all, except in emergencies.

List everyone you see now: your main doctor, any specialists, your kids’ doctor, and the hospital you’d want to use. Then check each name on every plan you compare.

Say your child sees a specialist for asthma. A plan that looks great on paper won’t feel great if that doctor isn’t in its network. Checking first beats finding out at the front desk.

Your prescriptions

Each plan also has a drug list, sometimes called a formulary. It shows which medicines the plan covers and what you pay for each. The same drug can cost very different amounts from one plan to the next.

Write down each medicine you take, the dose, and how often you fill it. Say you take a brand name drug every month. On one plan, say it’s $25 a fill. On another, you might pay full price until you meet the deductible.

How much care do you usually need?

Think back over the last year or two. How often did you go to the doctor? Is any care already planned for next year?

• If you rarely go, a lower monthly price with a higher deductible may make sense. Just be sure you could pay that deductible if something happens.
• Do you have an ongoing health problem, regular visits, or a baby on the way? Then a plan with a higher monthly price but lower costs at the doctor may cost less overall.

Say you’re expecting a baby next spring. You already know there will be lots of visits and a hospital stay. That’s a year when the out-of-pocket maximum matters more than the monthly price.

Why does your household income matter?

If you buy a plan through the health insurance marketplace, you may qualify for savings based on your household income and size. That can lower your monthly price. Sometimes it also lowers what you pay when you get care.

You don’t need exact numbers. A rough guess at next year’s income for your household is enough to start.

Say you’re self-employed and your income goes up and down. Use your best guess, and update it if things change during the year. Savings based on income may get settled up at tax time, so ask a tax professional how a change could affect you.

Your list before you compare