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Your Health Insurance and Health Care Costs Explained

The costs for care and coverage are related, but not the same

Written by: Andrew Hall.

Key Takeaways

  • Your health insurance costs vary based on your plan’s cost-sharing and your healthcare needs.

  • Most health insurance plans allow you to receive preventive care for zero cost or a small copay.

  • In-networkIn-network refers to the doctors, hospitals and other providers that are inside of your provider network. This is the group of providers that has agreed with your health insurance company to treat its customers. services are always going to cost the least, so know your plan’s networkA provider network is a group of doctors, hospitals and other specialists that have an agreement with an insurance company to treat its clients. It's usually less expensive for you to see a doctor within your provider network..

  • If you have daily Rx needs, ensure your plan’s drug formulary includes your prescription.

What does your health insurance cost?

Your final costs for health insurance can vary based on several factors. Rising or decreasing health insurance costs depend on the type of health coverage you select, your plan’s premium, and the deductible that comes with your plan which determines your out-of-pocket costs. Your insurance costs also factor into whether you qualify for a subsidy through the Affordable Care Act (ACA) or if you have a group plan or individual plan.

What does your health care cost?

Your healthcare costs depend on the services you need during your plan’s calendar year. Most insurance plans cover wellness exams and preventive care, meaning these doctor visits and services could cost you zero dollars. If you need diagnostic services, like lab tests, you may be required to cover copays or deductibles. Without insurance, a primary care visit could cost you anywhere from $100 to $200.

Understand the Cost of Your Care

It’s important to ask questions about your care and know what you can expect for healthcare services. Many plan options have increased the level of cost-sharing to encourage better decisions for preventive care and health and wellness. You and your health insurance provider share the costs of care through premiums, deductibles, and copays.

Provider networks linked to your coverage can also change your costs. Your plan’s network should include the providers you want to see for your care. Once you know you’re covered in-network, it’s a good idea to know what it costs to see a provider out of network. An in-network provider visit will always cost less than seeing a provider outside of your plan’s network.

Understand the Cost of Your Prescription Drugs

On average, Americans spend over $1,200 per year on prescription drugs. [1] Prescription drug costs can vary, and the range of value can depend heavily on whether a drug is generic or name-brand. The average cost for a generic prescription is $6, [2] while a name-brand prescription averages $30. Insurance companies use prescription drug formularies and drug tiers to determine available medications. Low tiers are usually the lowest cost, and costs increase when the drug tier increases. Be sure to ask about your plan’s formulary and pharmacy network to ensure your prescription is included. You may also save money by asking your doctor if a generic brand is available for any of your prescriptions.

How to Get the Right Plan for You

Before you choose any plan, know what you can afford and the type of care you may need. It’s important to ask questions about your plan’s networks and costs, like:

  • Is your preferred provider in-network?
  • Does the plan’s formulary cover your prescription?
  • What is your premium, deductible, copay and coinsurance cost?
  • What hospitals and specialists are in-network?

These questions will help you plan for your care and your cost and reduce any unexpected costs.

FAQs

Will my premium increase if I need maternity care during a plan year?

No. Nearly all plans cover maternity. Since January 2014, the ACA has required all newly issued and renewing individual and small group health insurance policies to provide maternity coverage. If you’re planning to get pregnant, make sure you’re preferred OB/GYN or provider is in-network.

When is open enrollment for families and individuals?

In every state, open enrollment for ACA-compliant 2021 health coverage for individuals and families will start on November 1, 2020. In most states, it will end on December 15, 2020. The December 15 deadline applies in every state that uses HealthCare.gov (that’s 36 states in the fall of 2020), and it will also likely apply in some of the states that run their own exchanges.

But the 15 fully state-run exchanges have the option to extend their open enrollment windows, and most of them usually do so.

California, Colorado, and DC have permanently extended their open enrollment periods:

  • California: November 1 to January 31
  • Colorado: November 1 to January 15
  • District of Columbia: November 1 to January 31