Individual health insurance provides individuals and their families with coverage for essential medical expenses. While some people receive health insurance through their employer, not everyone has this option. Luckily, there are a variety of options available to fit the preferences and budgets of just about everyone. Whether you’re self-employed, unemployed, or simply looking to find a health plan customized to your specific needs, individual health insurance provides essential for basic healthcare costs.
While all individual health insurance plans differ from one another, in general they all provide a certain level of care. Most healthcare plans cover part or the entire cost of things like doctors visits, preventive care, hospital care, emergency stays, mental health care, pregnancy and maternity care, prescription drugs and much more. To help you better understand your options when it comes to individual health insurance, take some time to explore the sections below.
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ACA Plans
The Affordable Care Act (ACA) created the Health Insurance Marketplace as a way to provide millions of uninsured Americans with coverage. The Health Insurance Marketplace is a federally run service available to all Americans, but encourages states to set up their own individual marketplaces. While many have their own, some chose to join the federal exchange instead.
On the Marketplace, people can shop for and compare different health insurance plans and insurers to find a plan that suits their needs.The ACA also regulates what medical services healthcare plans cover. ACA-approved plans are also barred from charging more or refusing coverage based on an applicant’s pre-existing health conditions.
Want to learn more? Check out our full, in-depth ACA Plans Guide.
Short-Term Insurance
If you need a health insurance plan outside of the Open Enrollment Period, or need healthcare in the case of an emergency, short-term health insurance is a solution for temporary medical coverage. Short-term health insurance plans are best used to bridge a coverage gap while you search for a longer-term health insurance solution. Most short-term plans cover preventive care, doctor visits, urgent care, and emergency care to some extent. Some prescription drug coverage might also be available. Additionally, some short-term insurance plans may provide discounts for using in-network doctors and hospitals.
While short-term care generally covers most individual’s basic healthcare needs, they usually don’t provide the same depth of coverage as a traditional health insurance plan. With that said, it’s important to read the “exclusions and limits” material associated with short-term plans to understand what they don’t include.
Want to learn more? Check out our full, in-depth Short-Term Insurance Guide.
COBRA Insurance
The Consolidated Omnibus Budget Reconciliation Act, widely known as COBRA, was created in 1986 as part of the larger Employee Retirement Income Security Act of 1974 (ERISA). It gives certain workers the right to pay premiums and keep their group health insurance coverage in certain situations, such as losing their job. Before Congress passed the ERISA law, people who had health insurance through their employer lost it as soon as they left their job for any reason.
With COBRA in effect, now workers who leave a company that offers health insurance can choose to keep their coverage temporarily. COBRA coverage is often more generally more expensive than what active employees pay for their group health plan because the company typically pays for some or all of the coverage. As it currently stands, businesses with 20 or more full-time equivalent employees must offer COBRA coverage.
Want to learn more? Check out our full, in-depth COBRA Insurance Guide.
HMO (Health Maintenance Organization)
A HMO (Health Maintenance Organization) is a type of affordable health insurance plan that offers a network of providers you can choose from for your healthcare needs. HMOs can give you coverage at lower rates because their networks are more limited and less flexible than those of other types of plans. Lower rates, but less flexibility are the two key components of HMOs.
An HMO’s care network is the key to its coverage. The providers in an HMO’s network, like doctors, hospitals, labs, and specialists, all have contracts with the plan, and are paid to offer a variety of health services to policyholders. These plans often have a geographic service area, meaning you’ll have to see providers in your specific area, and the fees associated with the plan will be determined based on your area’s specific population.
While HMOs have less flexibility than other plans, they have lower premiums. Due to their limited networks, coupled with the fact that providers in the network have patients directed to them, means savings gets passed on to you.
Want to learn more? Check out our full, in-depth HMO Guide.
HDHP (High Deductible Health Plan)
A High Deductible Health Plan, also known as an HDHP, is a specialized type of health insurance plan that offers lower monthly premiums compared to a traditional plan, but comes with higher out-of-pocket costs before the coverage kicks in. HDHPs were created to help individuals and groups cut costs on their healthcare plans, while still gaining essential healthcare benefits.
Another unique aspect of an HDHP is that they qualify for and are usually paired with a Health Savings Account (HSA). While HDHPs come with higher deductibles compared to typical health plans, HSAs complement them perfectly by allowing individuals to set aside tax-free money to cover these out-of-pocket medical expenses.
Want to learn more? Check out our full, in-depth HDHP Guide.
HSA (Health Savings Account)
If you’re looking for another way to help pay for your medical expenses, a Health Savings Account (HSA) could be the way to go. These tax-advantaged accounts for people with High Deductible Health Plans (HDHPs) allow you to put money aside for qualified medical expenses, like prescription drugs, as well as medical, dental, and vision care. The money you put aside even grows with time. There are restrictions on who can get an HSA and how much you can contribute, but these accounts offer a lot of benefits.
Only individuals with a high deductible health plan can get an HSA. HDHPs have higher annual deductibles to meet, but they typically have lower premiums than other types of plans. If you choose to open an HSA alongside your HDHP, you will deposit money into the HSA that you can withdraw to pay for qualified medical expenses that your plan doesn’t cover, including medications and medical equipment. You can even use your HSA funds to pay your medical bills until your deductible is met, and then use it to cover coinsurance or copays until you meet your out-of-pocket maximum for the year.
Want to learn more? Check out our full, in-depth HSA Guide.
Catastrophic Health Plans
Catastrophic health insurance plans are specially designed to provide basic coverage for “just in case” scenarios, and have affordable premiums. It’s important to note that these plans are not available to everyone, though. In order to purchase a catastrophic health plan, you must be under the age of 30 or meet the requirements for a “hardship” exemption.
Catastrophic plans are really only designed as last resort coverage, but they are a good option if you can’t afford another type of plan, because they will help you avoid a scenario in which you’re hit with a medical bill for thousands of dollars. The monthly premiums for these plans tend to be relatively low, but you will typically be required to pay for all of your healthcare expenses.
Want to learn more? Check out our full, in-depth Catastrophic Health Plans Guide.
Medicare Supplement
Medicare Supplement Plans, also known as Medigap plans, are called this because they supplement Original Medicare, and help to fill the coverage gaps in Parts A and B. While Original Medicare is a government program, Medicare Supplement Plans are sold by private insurance companies. You’ll have to pay a monthly premium to your insurance company (and you’ll have to be enrolled in Medicare Parts A and B), but you’ll end up paying less than you do with Original Medicare, since your low monthly premium will generally cover most of the out-of-pocket costs associated with Parts A and B.
The Centers for Medicare & Medicaid Services (CMS) requires all Medicare Supplement Plans to provide the same benefit coverage across the country, and you will never be denied care by providers who accept Medicare with these plans, but premiums can vary by insurance company. That means it’s important to compare plans from different insurers before making your choice.
Want to learn more? Check out our full, in-depth Medicare Supplement Guide.
Medicare Advantage
Medicare Advantage, sometimes called Medicare Part C, is a type of plan offered by private insurers who have signed a contract with the Medicare program. This contract ensures that private insurance companies who offer Medicare Advantage Plans follow the rules set by Medicare.
So, what is Medicare Advantage, and what does this type of plan cover? Well, if you enroll in a Medicare Advantage Plan through a private insurer, you will still be enrolled in Medicare, but most of your Parts A and B coverage will come directly from your plan, rather than from your Original Medicare plan. Additional coverage, like vision, hearing, dental, and health and wellness programs, may also be available through your Medicare Advantage Plan. The majority of these plans also include Medicare Part D (prescription drug coverage).
Want to learn more? Check out our full, in-depth Medicare Advantage Guide.
Get Health Insurance Today with EZ.Insure!
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