Choosing Health Insurance

Choosing a health insurance plan

If you're fortunate enough to get health insurance through your work, your choice of plans will be decided by your employer. You still need to take the time to review each plan to see which will benefit you the most.

♦ No health insurance through work? You'll need to buy it on your own.

The first option should be to see if you can get Obamacare. Insurance marketplaces (exchanges) sell health insurance.

How to find a health plan

There are many advertisements these days by companies and brokers claiming to be able to find you the best plan. Unfortunately, many of these people aren't really affiliated with the official state or federal marketplaces.

• Some unscrupulous brokers have been known to place people into plans that provide very little protection but pay better commissions.

♦ There's also a real threat that some of these companies offering enrollment are using data centers in foreign countries, where ACA customers' data may easily be compromised.

Federal rules require all ACA data to remain in the U.S. That appears to be one reason several companies have been banned from selling ACA plans.

It's best to start your search at the official federal marketplace website, HealthCare.gov, even if you don't live in a state served by the federal marketplace.

The federal site will link to the official enrollment site for your state. It also has links for getting local help, like finding an assister or sales agent near you.

The federal site also offers help through a call center.

• You don't need a broker to enroll at a marketplace. However, sorting through dozens of options can be challenging, so many people do seek help.

Premium tax credits

If you qualify for premium tax credits, you can get health insurance at a reduced cost. The catch is that premium credits can only be used for health insurance offered on the marketplaces.

• Don't assume you won't qualify. Go through the application process and find out. At the same time, you'll learn if you qualify for Medicaid.

♦ The extra premium help that started in 2021 expired at the end of 2025. Tax credits are now smaller for many people, and those earning more than four times the poverty level generally don't qualify. Many people saw their premiums jump in 2026.

If you don't qualify for tax credits, you can still buy insurance through the exchanges, but you pay full price.

• If you'll be paying full price, you can also buy insurance directly from insurance companies. This option offers the most choices but will usually be more expensive.

All major medical health insurance plans with effective dates of January 1, 2014 or later are required to be ACA-compliant. This is true whether they're sold on the exchange or off-exchange.

This means these plans must meet minimum standards set by the Affordable Care Act. They must cover pre-existing conditions, provide free preventive care, and not cap annual benefits.

Insurance companies can no longer sell major medical plans that pay virtually nothing.

♦ Words of caution: bare-bones plans are making a comeback through Short-term Health Insurance.

Short-term plans don't have to follow the ACA's rules. They can refuse people with pre-existing conditions and leave out basic benefits. Insurance agents are eager to sell them because of better commissions. Consumer Reports calls them "junk health insurance."

The rules keep flip-flopping. In 2018, the first Trump administration allowed these plans to last up to 36 months. In 2024, the Biden administration limited them to four months. In August 2025, the Trump administration announced it would stop enforcing that limit, and plans lasting up to 36 months are being sold again in many states. Supporters say they give people a cheaper option. Critics say people buy them not realizing how little they cover.

• State rules vary, so check what's allowed where you live, and read the fine print.

Low monthly premium or a low deductible?

As a rule, the lower your monthly premium, the more you have to pay when you use health insurance.

Plans with lower monthly premiums generally have higher deductibles. That means you have to pay more upfront before your insurance starts to pay.

• If you're young and in good health, you're probably thinking you'd like to pay as little as possible for health insurance.

It's possible to do that. All plans have to provide preventive benefits, but after that any type of emergency will be expensive.

A cheaper plan will probably also limit you to a small network of doctors.

• New in 2026: all bronze and catastrophic Marketplace plans count as HSA-eligible, so you can save for your deductible with tax-free money. See Health Savings Account.

Use health insurance a lot?

People with serious health conditions often choose plans with higher monthly premiums because they know they use more health care.

• These plans offer lower deductibles and usually lower copays and coinsurance.

• These plans are usually less restrictive and have a larger network of doctors and facilities.

Over the course of a year, these plans can result in lower out-of-pocket costs compared to cheaper plans.

Understand the basics

Deductibles, maximum out-of-pocket, copayment and coinsurance are cost-sharing methods insurance companies build into all plans to shift costs to the patient.

It's best to have a basic understanding of these costs before deciding on a plan.

Ultimately, the plan you choose comes down to how much you can afford to pay every month and how much you can afford to risk.

How to compare

Evaluate yourself and all family members.

• Are you in good health and rarely see a doctor, or will you probably need a lot of care?

Weigh what's most important to you and what you can comfortably risk.

Make a checklist to help compare policies

• What's the monthly premium? You have to pay this every month, even if you never see a doctor. If you can get a premium tax credit to help, that's great.

• What's the annual deductible?

Individual and family deductibles are reaching mind-boggling highs.

Check this carefully, because insurance companies are shifting more health care costs to the patient by applying more and more things to the deductible.

A high deductible comes with a high risk.

• How much copayment and coinsurance are you expected to pay?

• What's the maximum out-of-pocket? This is important if you have a serious health crisis and need a lot of health care. Bills can add up really quickly.

The maximum out-of-pocket is the most you have to pay in one year. After you reach this amount, your insurance has to pay the rest. The lower the maximum, the better.

• Are your doctors and local hospitals in the plan's network?

In an emergency, you can go to any hospital. Your insurer has to judge whether it was an emergency by your symptoms, not your final diagnosis. But for planned care, using an out-of-network hospital can cost you a lot.

It's best to have a plan that includes your doctors and the closest hospital.

• Are there urgent care facilities near you? More and more plans are applying emergency room charges to the deductible. With that in mind, you're more likely to try an urgent care facility before the ER.

A plan has less value if the nearest urgent care is many miles away and closes at 6 pm.

• How does the plan cover lab tests? Is there a separate deductible for laboratory services, or do the charges go against the individual deductible?

Any tests not done for preventive care will get applied to this first. You need to factor this expense into your plan's overall cost.

• Are you taking an expensive medication? All plans have an approved drug list called a formulary.

Be sure your medication is on the formulary. If it isn't, it can be a real struggle to get your insurance company to approve it.

• If you travel a lot, you run the chance of needing health care away from home. Consider this carefully, because if you'll worry about coverage away from home, you may want to look only at PPO and POS plans.

• Do you expect a big hospital bill in the near future? Maybe a knee replacement can't be put off, or a baby is on the way. A plan with a high deductible could be a financial disaster.

• Is rehabilitation therapy coverage adequate? Plans can still limit the number of times you can visit a physical therapist.

• Outpatient services – most people overlook this benefit. But an ever-increasing number of surgeries are being done as outpatient procedures. Having a plan with good outpatient benefits can be a game changer.

Which type to choose?

Health insurance policies come in four basic types: HMO, PPO, EPO and POS. See Types of Health Insurance for a fuller explanation of each plan type.

In brief, they're all a form of Managed Care. This means they try to control costs by controlling the providers you see, the procedures you can get and the fees providers can charge. They do this by contracting with doctors and hospitals to provide services to their members.

This is good for members, because they have less worry about getting hit with unexpected bills. It's not so good for members, because they have to be careful to follow their plan's rules.

HMO stands for Health Maintenance Organization. HMOs are becoming the most common plans offered on the exchanges.

They have the most limited network of providers and the most restrictive rules.

Most require you to choose a primary care doctor. You'll need a referral from your primary care doctor to see a specialist.

If used wisely, they can be the least costly.

PPO stands for Preferred Provider Organization. PPOs were once very common, but with health care costs rising fast, they're quickly disappearing from the individual market.

Larger employers continue to offer PPO plans.

These plans are the opposite of HMO plans.

They have large networks of providers and often allow you to use providers outside the network.

You don't need a referral to see a specialist.

EPO stands for Exclusive Provider Organization. EPOs are a mix between HMOs and PPOs.

You're required to use the plan's network, but you don't need referrals to see a specialist.

In some ways they're less restrictive than an HMO.

Depending on where you live, an EPO may have a smaller network than an HMO.

EPOs these days are pushing rather steep deductibles in exchange for more attractive monthly premiums.

POS stands for Point of Service. These plans aren't very common.

Like a PPO, you aren't limited to the plan's network.

You usually need to choose a primary care doctor. You'll need a referral from your primary care doctor to see a specialist.

♦ Of the four common types of plans, HMO and EPO plans tend to be cheaper than PPO or POS plans.

Many times HMO and EPO plans will have a very limited network of providers.

If you expect to use health insurance quite a bit, it may be worth paying a little more for a PPO or POS policy, just to improve your chances of finding a good doctor in your area, or to be able to use someone outside your local area if needed.

Marriage lasts a year

Whatever plan you choose, you'll need to keep it until the next open enrollment. So take your time comparing plans.

For 2027 coverage, open enrollment on HealthCare.gov runs from November 1, 2026, to January 15, 2027. Sign up by December 15 if you want coverage to start January 1. States with their own marketplaces may have different dates.

There are special enrollment periods, but as the name implies, something special must happen in your life for you to qualify. Simply choosing to stop paying your monthly premium isn't such an event.