Watch Out for “Cheap” Health Plans – They May Cost You More Later

Open enrollment time is here, and picking a health plan can be confusing. Low cost health plans might look like a good deal because they have lower monthly payments, but they often come with hidden costs that could surprise you. Here are some important things to check before you choose a “budget” health plan.

1. Hidden Costs for Doctor Visits and Hospital Care

Low monthly costs might mean high costs when you need care.

These low cost plans may have low monthly payments, but they often come with higher costs when you go to the doctor, hospital, or have a medical test. For example, you might have a high “deductible” to pay before the plan starts covering much of your care. And remember, many of these plans are not compliant with the Affordable Care Act and do not provide the same protections or coverage.

What to do:
Look at the “deductible,” “out-of-pocket maximum,” and other costs in the plan details. If you think you may need more than just basic care, it might be better to pick a plan with a slightly higher monthly cost but lower costs when you go to the doctor. Be sure to watch for the term “LIMITED BENEFITS”. This can indicate that while inpatient services are a covered benefit, they may be limited to a maximum of $5000. In an emergency situation, this can leave you essentially uninsured.

2. Limited Doctors and Hospitals to Choose From

Fewer choices might mean you have to pay more or drive farther to get care.

Many low cost plans keep their prices low by limiting the doctors, specialists, and hospitals you can use. If your plan doesn’t cover your preferred doctors or specialists, you might have to pay more or travel farther to get the care you need.

What to do:
Before choosing a plan, check if your favorite doctors or hospitals are covered. Think about whether you might need to see specialists and how easy it would be to get to a doctor in the network. Also beware of Exclusive Provider Organization (EPO) which is a type of health insurance plan that limits coverage to a network of providers and facilities. This is the most limiting type of network and many times there are no out of network benefits available.

3. Some Types of Care Might Not Be Covered

Look out for plans with limits on certain types of care.

Some low-cost plans don’t cover everything, like mental health services, physical therapy, or maternity care. You might find out later that certain treatments aren’t covered, or they have strict rules.

What to do:
Make sure you know what the plan does and doesn’t cover. You can ask for a “summary of benefits” to help you understand what’s included. Look for services you might need, so there are no surprises. Be sure to review the plan documents for the word “exclusions” to be certain you understand anything the policy says it will specifically not cover.

4. Limited Prescription Coverage

Some plans don’t cover every medication.

A low-cost plan might only cover a few types of medications or may not cover specific prescriptions, especially if they’re brand-name drugs. This could mean higher costs if you need certain medicines.

What to do:
Check the list of drugs that the plan covers, especially if you already take certain medications. If your medicines aren’t covered, you could end up paying for them out-of-pocket.

5. Not Much Support for Preventative and Alternative Care

Cheap plans may skip covering wellness visits and other ways to stay healthy.

Some low-cost plans don’t offer as much coverage for check-ups, wellness programs, or care like acupuncture or chiropractic treatments. Without this support, it may be harder to keep up with your health goals.

What to do:
If staying healthy with check-ups or wellness care is important to you, look for a plan that covers these services. It may cost a little more each month but could save you money in the long run by helping you stay healthy.

Final Thoughts

Low monthly payments sound nice, but remember, these “budget” plans often have hidden costs. Sometimes, paying a little more each month saves you from big bills later. If you want help picking the best plan for your health and budget, I’m here to chat! Schedule a free call to talk about your options for 2025, and together, we’ll find a plan that works for you.

Let’s make this enrollment season a success!