Health insurance premium costs have steadily increased over the years to the point where it pays to shop around. Everyone is in a unique situation when it comes to health. So consider your options based on your family size, the state of health of your family members, and other personal factors.
While each insurer has its own methodology for pricing, here’s a look at the five key factors that affect all policyholders.
- Your Age
The older you get, the greater are your chances of getting ill and seeing a doctor. This means you’ll likely face rising premiums as you age. According to HealthCare.gov, older people tend to pay premiums that are three times higher than what young people pay. Part of the reason is that older people use medical services and medicines more often than younger people.
States set rules and regulations for insurance firms that operate within their jurisdictions, affecting costs. Generally, higher rent places like New York City or San Francisco have higher insurance costs than regions where living costs are much lower. An advantage of living in a major market is that more insurance companies compete for customers, which opens the door to more discounts and special plans.
- Insured Parties
Your health insurance premiums increase with the number of people your plan covers in your family. Overall, family plans tend to be more cost-effective than separate individual plans. It’s more important that you find the plan that delivers the best coverage to meet your family’s health needs than to worry about finding the lowest prices.
- History of Tobacco Use
Tobacco smokers pay more for health insurance due to a surcharge in the Affordable Care Act (ACA) that allows insurers to raise premiums. The surcharge may be as much as half of the premium cost. Although this surcharge on tobacco smokers is controversial, it’s designed to help people quit smoking. Insurers view tobacco as a financial as well as a health risk.
- Type of Coverage
Here are the main categories of health insurance plans under the ACA:
- Bronze plan – This plan offers the lowest monthly costs but the highest deductibles, which are typically over $6,000.
- Silver plan – While this plan costs a little more than the bronze plan, it has a lower deductible. It’s a money-saving option if you have no chronic conditions and only see a doctor occasionally for checkups and preventative care.
- Gold plan – You’ll be paying much higher premiums with this plan, but you’ll have low out-of-pocket expenses when you visit the hospital. This plan is suitable for patients with at least one chronic condition.
- Platinum plan – This plan has the highest premiums but the lowest deductibles and is designed for patients with multiple conditions.
- Catastrophic plan – Only people under 30 with proof of financial hardship qualify for this plan. The premiums are low, but the deductibles are high.
Getting the best deals on health insurance takes a bit of research, but it doesn’t come down to just who offers the lowest prices. You need to make sure you have access to health coverage that makes sense for your family.
When you need health insurance, contact our reputable agents at Chambers & Company Insurance Brokers to learn more. We are ready to help you find the health plan that suits your needs.