How To Choose The Best Healthcare Plan

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How To Choose The Best Healthcare Plan | Open Enrollment Explained  Confused by open enrollment? Not sure what the difference is between an HMO, PPO, or HDHP? In this video, we break down the most common types of healthcare plans and the key insurance terms you need to understand—like premiums, deductibles, copays, and out-of-pocket maximums.  Whether you’re picking your first plan or reevaluating during open enrollment, this guide will help you make an informed, financially smart decision.  📌 Don’t forget to like, subscribe, and hit the bell for more personal finance and healthcare tips!  #HealthcarePlans #OpenEnrollment #HSA #InsuranceExplained #PersonalFinance

Transcript

00:00Okay, so if you just got that dreaded open enrollment email from your employer, you've

00:05come to the right place.

00:07Today, I'm going to give you an in-depth breakdown of the different types of healthcare

00:10plans, fill you in on that healthcare lingo, what is a deductible anyway, and try to help

00:15you walk away knowing which plan might be best for you.

00:18Now, I'm not saying this will be the most exciting topic, but I am going to give you

00:22some crucial information to use when thinking about your overall financial situation.

00:27Healthcare can have a massive impact on this.

00:29I mean, for many of us, medical emergencies might be the most expensive purchase you

00:34make in any given year.

00:36So, if you want our finances to stay on track, don't let a medical emergency derail you.

00:41Keep watching this video.

00:43What is open enrollment?

00:45Okay, so first off, what is open enrollment?

00:48This is the time when you have to decide which healthcare plan you're going to choose for

00:51the following calendar year.

00:53It's typically November 1st through January 15th.

00:56Once you choose that plan, you're pretty much set for the next year, unless there's

01:01a major event like a new job or a child.

01:03So, it's really important you do a bit of extra research right now to choose something

01:07you might be stuck with for a full year.

01:10Types of plans

01:10There are other types of plans available, especially for non-employer group plans, but today we'll

01:28just cover these.

01:28Basic healthcare lingo

01:30Premium

01:31This is what you'll pay each year just to have insurance.

01:35Usually, this comes out of your paycheck, and employers typically cover around 70-80%

01:40of it.

01:41Think of it as your subscription fee for having insurance.

01:44Deductible

01:45This is the amount of money you need to spend on healthcare, not including your premium,

01:49before your insurance starts to pay.

01:51Preventative care is usually covered before you hit the deductible, so this really applies

01:56to care beyond routine checkups.

01:59Co-insurance

02:00This is the percentage of healthcare costs you pay after hitting your deductible, but

02:04before reaching your out-of-pocket max.

02:06Many plans require you to pay around 10%.

02:10Out-of-pocket max

02:11This is the most you'll spend on healthcare in a year, not counting your premium.

02:16After you hit this, your insurance covers 100% of your costs.

02:20Co-pay

02:21This is a fixed amount you pay for a covered medical service.

02:25For example, you might pay $20 to see a doctor, and the rest is covered by insurance.

02:31HMO

02:32HMO plans require you to choose a primary care physician, PCP.

02:36That doctor manages all your care and referrals.

02:40These plans usually have lower premiums because they have deals with certain providers.

02:45The trade-off?

02:46Less flexibility

02:47You generally have to see your PCP before you can visit a specialist.

02:51If you like structure and saving money, and don't mind going through your PCP first, HMO

02:57might be a good fit.

02:58PPO

02:58PPOs are the most common plan type by enrollment.

03:02You don't need referrals to see specialists, and you can go straight to in-network providers.

03:07Just try to stay in-network.

03:09Going out of network can be expensive and complicated.

03:12PPO plans typically have higher premiums but lower deductibles.

03:17You'll often pay a co-pay per visit or meet a small deductible before insurance kicks in.

03:22PPOs also tend to have broader coverage and more provider options, which is why they cost more.

03:28FSA

03:28An FSA, or Flexible Spending Account, is a tax-advantaged account for medical expenses.

03:34It's often paired with HMO or PPO plans and funded through pre-tax payroll contributions.

03:41But here's the catch.

03:43It's use it or lose it.

03:45Whatever you don't use by the end of the year, or if you change jobs, you lose.

03:50Planning ahead is key to making this work for you.

03:53HDHP

03:54High deductible health plans have higher deductibles but lower premiums.

03:59The big perk?

04:00You can use an HSA health savings account with them.

04:03HDHPs are good for people who are generally healthy and don't expect many medical expenses.

04:09But it's risky.

04:10If something unexpected happens, you're paying a lot out of pocket before coverage kicks in.

04:16According to IRS rules, HDHPs have a minimum deductible of $1,400 for individuals or $2,800 for families.

04:25Out-of-pocket maxes are capped at $7,000 for individuals or $14,000 for families.

04:32HSA

04:33An HSA is a health savings account only available with an HDHP.

04:38Like an FSA, you contribute pre-tax dollars.

04:42But unlike an FSA, unused funds roll over year after year, and you can even invest them.

04:48HSAs are triple tax-advantaged.

04:51Contributions lower your taxable income.

04:54Earnings grow tax-free.

04:55Withdrawals are tax-free when used for eligible medical expenses.

05:00If you max out your HSA for 20 years and invest with a 7% return, you could have over $160,000 saved.

05:09That's huge, especially considering health care is often the biggest retirement expense.

05:15Conclusion

05:16So, how do you choose the right plan?

05:19If you value lower premiums and are healthy, consider an HDHP with an HSA.

05:25If you want flexibility and don't mind higher premiums, a PPO might be your best bet.

05:30If you want lower costs and don't mind sticking with a single provider network and referrals, an HMO can be a cost-effective option.

05:37Think about your current health, expected medical needs, your financial goals, and don't forget to review which providers are in-network.

05:45It's not fun, but taking a bit of time now can save you a lot of money and stress later.

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