Perhaps your employer-provided insurance is a bad match for your situation, or maybe you're ready to start your own business. Regardless of the underlying factors, you now need to purchase your own health insurance. If you find yourself in this situation, adhere to these guidelines to find a policy that suits your coverage needs without blowing your budget.

The Affordable Care Act (ACA) established a health insurance market for individuals to purchase their insurance policies. These markets are different for each state and are also known as health insurance exchanges. It's easy to compare the benefits of and differences between plans on the exchange, and enrollment is fairly simple. You can also apply for subsidies to offset the cost of coverage.



However, you may also buy an off-exchange plan via an insurance agent or broker. Off-exchange plans are a viable alternative for individuals who do not qualify for subsidies or are unhappy with the coverage of the exchange plan options. Make sure that you compare the costs of plans both on and off the exchange to determine how you can get the most benefits for your money.

2. Complete Your Research in a Timely Manner

Another change brought about by the ACA is that you must now purchase your health insurance plan during a designated period known as open enrollment. This period occurs at the end of the year. However, if you experience a qualifying life event, you can buy a health insurance policy at any time of the year.



The most common qualifying life events include:

• The loss of your existing healthcare insurance
• The addition of a dependent to your family via birth, adoption, or foster care
• Marriage or divorce
• Relocation to an area with different health plans available on its exchange

Should you experience a qualifying life event, you typically have 60 days to purchase a new policy. Whether you decide to buy insurance during a qualifying life event or during open enrollment, you'll want to start your research as early as possible. This helps ensure that you complete all of your research before the deadline for your enrollment period.

3. Understand the Lingo Before You Compare Plans

Before you start comparing potential plans, make sure that you understand common terminology used to describe the coverage details of health insurance plans. The following are some of the most common terms you'll encounter:

• Insurance premium: This is the cost of your policy.
• Deductible: This is the dollar amount of specified medical expenses that you have to pay before your coverage kicks in.
• Co-payments: This is a stated fee that you pay when you utilize certain medical appointments.
• Co-insurance: This is the percentage of your medical expenses that you're financially responsible for.
• Out-of-pocket maximum: This is the maximum amount of medical costs that you'll have to pay in a year.

You have to evaluate all of these factors when comparing plans. For example, assume plan A has a monthly premium of $800 per month. It requires a co-payment of $25 for each doctor's appointment and has a deductible of $1,000 for other medical expenses.

Once you hit your deductible, the plan has 90/10 co-insurance. This means that the plan pays for 90 percent of qualified medical expenses while you pay the remaining 10 percent.

Plan B has a monthly premium of $400 per month. It doesn't require co-payments; instead, every medical expenditure counts toward your deductible. However, your deductible is $2,500. After you hit the deductible, the co-insurance is 80/20 (the plan covers 80 percent of expenses and you pay for 20 percent of your expenses).

Generally, plans that have a lower deductible and cover more expenses have a higher annual premium. You'll have to run the numbers for a few different scenarios using your own medical needs to decide if it's worthwhile to pay more for a plan with better coverage.

Are you losing your existing health insurance? Contact American Quality Assurance Group today to speak with an agent.