When shopping for a health insurance plan in Massachusetts, many people base their decision solely on the monthly premium. When money is tight, some people choose plans with the cheapest monthly premium, while others forego health insurance altogether in an attempt to save a buck.
A premium may be an important aspect of health care costs, but basing your estimated health care costs on this alone won’t give you an accurate picture of what you can expect to spend. Learn more about how to estimate your total health care costs below.
Factor in Your Premium, Deductible, and Copayments
Beyond your premium, you must also consider your plan’s deductible and copayments/coinsurance. The deductible may be as little as $0, meaning that your insurance will help cover healthcare costs right away. It may be as high as several thousand dollars, which means that you will have to pay many healthcare costs on your own before your insurance will offer assistance.
It’s also helpful to be aware of your plan’s out-of-pocket maximum, which is the most you will ever have to pay for covered services in a year. Beyond this amount, your insurance will pay all medical expenses.
Consider How Many Medical Visits You Expect to Make
Once you are more familiar with what your plan does and does not offer, think about how often you expect that you will see a doctor, need prescriptions, or have to visit a specialist in a given year. Although it’s impossible to foresee every possible reason we may need to see a doctor in a year, it is possible to base your guess on how many times you have needed medical attention in past years.
If you have chronic conditions, like diabetes or heart disease, you can reasonably expect that you will have to visit a doctor more often and you may have a variety of medications you take. If, on the other hand, you do not currently have any chronic conditions and rarely get sicker than a seasonal cold, you can estimate that you will visit a doctor’s office fewer times throughout the year.
Understand Your “Metal” Category
Each health insurance plan in the Healthcare.gov marketplace is assigned a “metal” category, Bronze, Silver, Gold, and Platinum. Bronze plans are best suited for those who do not need regular medical services or have prescriptions. These plans offer lower monthly premiums but they may result in higher yearly costs if medical emergencies or illnesses arise.
Silver plans have a slightly higher monthly premium, but cover more than Bronze, though not as much as Gold or Platinum plans. If you routinely have high medical costs, it may be worth the higher monthly premiums to opt for a Gold or Platinum plan. Those with Silver, Gold, or Platinum plans may have higher total healthcare costs in some years than those with Bronze plans, but they may also result in lower out-of-pocket costs during other periods.
It’s impossible to predict exactly how much you will spend per year in healthcare, but by taking these factors into account, you can give yourself a reasonable estimate of what your total healthcare costs may be.
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