Health insurance can be overwhelming, but don't worry. We're here to help you understand the basics of health plan types, costs, and key terms. At Materna Health, we're in-network with most commercial insurance plans, and we're dedicated to helping you maximize your benefits. Here’s a step-by-step breakdown to guide you:

Step 1: Let's Compare Health Plan Types: PPO, HMO & HDHP

Preferred Provider Organizations (PPOs) are designed for those who value flexibility in their healthcare options. With a PPO, you are not required to stay within a network to receive coverage, but receiving care from in-network providers will generally cost less. Unlike other health plan types, PPOs do not require referrals to see specialists, which allows for greater freedom in managing one's healthcare needs. However, this flexibility tends to come at a higher cost, as the premiums for PPOs are generally more expensive than those for other types of plans.

Health Maintenance Organizations (HMOs) offer a more cost-effective approach but with stricter network limitations. With an HMO, coverage is limited to care received from providers who are part of the HMO’s network, except in emergency situations. Additionally, seeing specialists typically requires a referral from a primary care provider. The trade-off for these restrictions is lower premiums, making HMOs a good choice for those who are willing to work within a more controlled network to reduce their healthcare expenses.

High Deductible Health Plans (HDHPs) are another option, particularly appealing to those who do not frequently require medical services. HDHPs allow for both in-network and out-of-network care, though in-network care is more cost-effective. These plans typically require referrals for specialist visits and are characterized by higher deductibles coupled with lower premiums. HDHPs are unique in that they can be paired with a Health Savings Account (HSA), enabling individuals to save pre-tax money to pay for future medical expenses, which enhances their appeal to cost-conscious consumers.

Step 2: Compare Out-of-Pocket Costs

Now that we’ve navigated all those letters, let’s tackle the numbers ($$$). During Open Enrollment, you will pick a health insurance plan that's right for you. There are cost trade-offs when it comes to picking plans, which is why it’s important to choose one that makes the most sense for your life. Do you go to the doctor often? You may want to pay higher monthly premiums for a plan with a lower deductible to ensure your health plan covers more of your costs sooner.

Similarly, you might avoid the doc at all costs. In that case, you might be more comfortable with a higher deductible and a lower monthly premium. And let’s not forget changes to your health that might’ve impacted how often you use the doctor: yet another reason it’s important to know the ins and outs of your plan, reassess whether it’s working for you during Open Enrollment—and make the switch if it’s not.

Step 3:  Know Your Terms

There’s a lot to digest when it comes to comparing insurance plans, so here’s a glossary of some need-to-know healthcare cost terms to make it easier:

Premium: Health insurance premiums are monthly (sometimes quarterly) payments you make to your health insurance provider to keep your coverage. When choosing a plan, you’ll see a range of premium costs; you’ll want to weigh the costs against the plan’s other benefits before deciding which one’s best for you.

Deductible: The annual amount of money you need to spend before your health plan begins to help cover your medical costs. Deductibles vary in price and coverage from one provider to the next, so it’s important to understand how your insurer applies your deductible ahead of any visit. For example, some plans might apply it to all medical services, while others might have separate deductibles for different services, like prescription drugs.

It’s also important to know that deductibles directly affect your premium costs. Low premiums means higher deductibles—and high premiums means lower deductibles. In short: if you go to the doctor frequently, you might choose a higher premium. While you’ll pay more monthly, your lower deductible means your health plan will cover more of your medical costs sooner.

Copays: Copayments (also called copays) are set fees you pay when you get healthcare service during a visit. These flat-rate fees vary by plan and service. For example, you might have a different copayment amount for primary care physicians vs. specialists vs. prescription drugs. You can usually find copay amounts on your insurance card or by calling your health insurance plan.

Coinsurance: For most plans, coinsurance is the percentage of the cost you must pay after you meet your plan’s deductible—typically a percentage of the overall medical service cost. For example, your coinsurance share might be 20% of a hospital visit, and your insurer would cover the remaining 80%. Health insurance plans with higher monthly premiums often have lower coinsurance percentages for patients.

Maximum Out-of-Pocket Costs: Just like the name implies, these are the maximum amount you pay out of pocket, per year, for medical services. This amount includes your copay + the coinsurance amount + the deductible itself. (It’s important to note these maximums don’t include premiums or out-of-network costs. Some plans have out-of-network maximums too, while others don’t put a cap on what you'll pay for out-of-network care.)

Once you meet your maximum out-of-pocket amount, your health insurance company potentially takes over and covers any remaining balance. 

For example, let’s use the 2023 maximums: $9,100 for individuals and $18,200 for families. Say you’re an individual with no medical expenses for most of the year who suddenly needs emergency hospital care. If your health insurance plan requires you to pay 20% of the hospital costs, but that amount exceeds the  $9,100 out-of-pocket maximum, you’re only responsible for the $9,100. Your insurance company covers the rest.

Health Savings Accounts (HSA): A health savings account (HSA) is geared towards future medical expenses. Every year, you can decide how much money you want to put toward your HSA—and then you can use the money for deductibles, copays, and coinsurance. Your contributions are tax-free, and the balance rolls over from year to year. Because HSA funds are non-taxable when applied to the proper medical expenses, you can potentially reduce your tax burden. It’s important to note that HSA funds must be used to pay for qualified medical expenses, and premiums are typically not included as allowable costs.

Your Health Is Yours

When understanding your health insurance and how your plan aligns with your financial priorities and healthcare needs, there's a lot to consider. Materna Health can be a great way to maximize your health insurance. Our mix of postpartum care, including care coordination, lactation, physical therapy, and mental health helps make the most of your plan—and we’re in-network with most commercial insurance. Talk about a win-win.