Types of health insurance plans
Health insurance can seem complex, but it comes down to a few key variables — your monthly premium, how much you pay when you use care, and which doctors are in-network:
- HMO (Health Maintenance Organization): Lower premiums, requires a primary care physician referral for specialists, and limited to in-network providers. Best if you want lower costs and don't mind a gatekeeper.
- PPO (Preferred Provider Organization): More flexibility to see specialists without referrals. Higher premiums but broader access to doctors.
- HDHP + HSA: High-deductible plans paired with a Health Savings Account. Lower premiums, tax-free savings account for medical costs. Best for generally healthy people who want to build a healthcare emergency fund.
- ACA Marketplace plans: Subsidies can reduce costs significantly based on income. Open enrollment is November–January; special enrollment is available after qualifying life events.
Key terms to understand
Your premium is what you pay monthly. Your deductible is what you pay before insurance kicks in. Your out-of-pocket maximum is the most you'll ever pay in a year — after that, insurance covers 100%. Understanding these three numbers lets you compare plans apples-to-apples.
