Tuesday, June 25, 2024
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Health Insurance Coverage: Types of Plans and How to Decide

Health Insurance: Types, Coverage, and Tips - How to select the right one for your needs, with expert tips and advice from an independent insurance agent.

The US has one of the most expensive healthcare systems in the world. According to the American Medical Association (AMA), health spending stands at $12,914 per person.

That makes health insurance one of the most important insurance coverages. It helps reduce the financial burden on individuals and families in case of unexpected health issues.

This article covers the different types of health insurance plans and how to choose the best health insurance coverage that fits your needs.

Types of Health Insurance Plans

Various types of health insurance plans are meant to meet different healthcare needs and preferences. Below are the most common types of health insurance plans that you can look into.

Health Maintainance Organization (HMO)

HMO plans have lower premiums and lower deductibles. However, they require members to use in-network healthcare providers. You choose a primary care physician (PCP) from whom you get referrals to see health specialists.

Preferred Provider Organization (PPO)

PPO plans are more flexible, allowing members to visit in and out-network healthcare providers without a referral. 

However, they come with higher premiums and deductibles. Members pay less if they use in-network health providers, but pay more for out-of-network care.

Exclusive Provider Organization (EPO)

EPO combines both HMO and PPO plans. Members are required to stick to in-network providers for regular use. 

But, in cases of emergency or urgent care, you can use out-of-network providers. No referral is required to see a specialist.

Point of Service (POS)

POS plans mix HMO and PPO features. Members choose a primary care physician from whom they get referrals to see in-network health specialists. Members can also select out-of-network providers but at a higher cost.

High Deductible Health Plan (HDHP)

HDHP plans require members to pay a higher deductible but have lower premiums. They also offer a Health Savings Account (HSA) to enable members to make tax-free savings for medical expenses.

Go for this plan if you can afford to pay higher out-of-pocket charges in exchange for lower premiums.

Government-sponsored health plans

Government-sponsored health plans in the US offer accessible health insurance to low-income families, the old, and people with disabilities.

They include:

  • Medicare: Medicare is a federally funded health insurance program for people aged 65 and above. It also caters to young people with disabilities. 
  • Medicaid: Medicaid is a health insurance plan for eligible low-income individuals and families run by both state and federal governments. 

How To Choose The Best Health Insurance Plan

Several factors come into play when choosing the best health insurance plan. They include:

Your needs

Assess your healthcare needs and the type of healthcare services you need. Your health plan should allow you access to the healthcare providers and specialists you need.

Identifying providers

Do your research and identify insurance companies that offer the type of health insurance you want.

You can search online, get recommendations from friends or family, or consult an independent insurance agent for guidance.

Comparing coverage plans

Compare coverage plans from at least 3 providers in terms of cost, benefits, coverage limits, deductibles, exclusions, and other features. Then, get quotes to compare the cost of each plan.

Provider’s reputation and Financial Stability

Online reviews, consumer agency ratings, and customer feedback are great ways to assess and gauge the reputation of a health insurance provider.

Also, check ratings from agencies like Moody’s, S&P, and AM Best to determine the financial strength of the provider.


To continue getting coverage, make sure you choose a plan that you can afford to pay. You need to be able to afford the monthly premium and the deductible.

If you find it a hassle to choose the best health insurance plan on your own, don’t fuss. An independent insurance agent can help you choose the best insurance plan that fits your needs and budget.

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