Insurance 101: Answering the Most Common Questions About Health Insurance

A recent survey found that 85% of Americans don’t know what benefits must be covered by insurers under the Affordable Care Act. That might be an alarming statistic in a vacuum — but everyone knows how complicated and confusing the healthcare system can be. Navigating health insurance, specifically, is a widely agreed-upon headache. In another survey, 56% of respondents said trying to understand health insurance made them feel “completely lost.”

Those statistics are not exactly encouraging. The combination of that confusion and continuously rising healthcare costs creates an environment that can be both intimidating and exhausting. It’s a system in which 43% of working-age adults had gaps in their coverage during the first half of 2020 — and in which the majority of Americans stress about health insurance costs.

Chances are, you know how this confusion and stress feel. Hopefully, you also know how important it is to take care of yourself. But doing that requires an understanding of how to navigate the maze of healthcare coverage.

Luckily, there’s good news: We can help. Maybe you’re a Gen Zer who’s just starting to worry about your healthcare options. Or perhaps you’re a Baby Boomer who’s been dealing with the complexities for a while. Either way, you likely have questions and are ready for answers.

Let’s dive into some common health insurance concerns for each generation — and some ways everyone can take their health into their own hands.

Generation Z and the Quest for Less Insurance Stress

Gen Z is a generation dealing with enormous stress. In fact, this generation is most likely to report their mental well-being as only fair or poor. Yet when it comes to seeking out professional treatment, many don’t know where to start.

About 45% of Gen Zers don’t have a primary care physician (PCP). Since many Gen Zers recently entered the workforce, dealing with health coverage is still a fairly new concept. The most common Gen Z healthcare questions we hear tend to focus on the nuts and bolts of finding care:

• How do I figure out my upfront costs? The best bet at figuring out what a procedure will cost you upfront is to read your explanation of benefits (EOB) thoroughly. It should give you a rundown of exactly what’s covered and what you’ll have to handle.

If the EOB is as clear as mud, your provider may offer tools like Health Karma, designed to help you more easily calculate your out-of-pocket costs for every type of treatment.

• How do I find out what’s covered under my insurance? Don’t throw away your documentation! Keep your paperwork somewhere safe because it should tell you everything you need to know. If not, contact your insurer directly. If you’re on your employer’s health plan, talk to your HR department or your benefits representative to get answers to your questions.

• Is my employer’s insurance any good? Good question! Determine your own health priorities and dig into your employer’s EOB to see whether your most important concerns are covered. Then, do some research online to see what else is out there and whether you’d be better off supplementing your insurance or looking at your state’s healthcare marketplace. We’ve also created a beginner’s guide to help you understand exactly what to look for when scoping out insurance plans.

• Is there an app for that? Many insurance companies provide mobile offerings and telehealth features since the pandemic turned these options into necessities. Check with your benefits provider or go to your insurer’s website to find out what apps are available to you.

Millennials and Money Matters

While many Gen Zers are still able to stay on their parents’ insurance plans, most Millennials have aged out of that option. That means there’s a greater urgency to find coverage and deal with rising healthcare costs.

For many in this generation, however, dealing with healthcare costs often means putting them off. Out of all the generations, Millennials are the least likely to be insured. That’s not because they don’t believe in insurance or are convinced they’re invincible — many just can’t afford it. In fact, 49% of Millennials have put off medical treatment due to financial concerns.

It shouldn’t come as a surprise, then, that many of the questions regarding Millennials and health insurance focus on finances:

• Do I really need to pay for health insurance if I’m young and healthy? Insurance is expensive, but it’s better to have it and not need it than need it and not have it. Why do you need health insurance? It only takes one unexpected health issue to rack up thousands of dollars in medical bills. Even something as simple as strep throat or the flu can become a costly burden without insurance.

• What’s my most cost-effective option? To answer this, you need to do some research on what your employer offers or what’s available to you under the ACA. You should also look into the differences between your health maintenance organization (HMO) plan versus your preferred provider organization (PPO) plan.

What are each plan’s copays? What about the coinsurance (the amount you pay after your deductible)? Out-of-pocket maximums? These will all be factors in the ultimate cost of your insurance.

If you’re in good health and can handle the cost of a high-deductible health insurance plan and higher copays, that can lower your monthly premiums. If you have chronic health issues, though, those costs could come back to bite you. Take the time and look at your recent medical history to determine which option fits your needs.

• How long can I stay on my parents’ plan? This one’s easy! Dependents can stay on their parents’ insurance plans until they’re 26. This is often the most affordable option, but most Millennials have already passed that age threshold.

Generation X and Planning for the Future

Like Millennials, a primary concern for Gen Xers is the high cost of healthcare. These concerns look a little different, though. For one, Gen Xers aren’t just figuring out how to pay for themselves — they’re also worried about paying for their children’s care as well as future care for their aging parents.

Generation X is worried about being able to afford care in the present in addition to the need to pay for treatment in the future without decimating their savings. They want to be able to balance health and wealth concerns for themselves and their families. Some of the most common questions we hear from this generation revolve around these concerns:

• What’s the best way to invest in healthcare for the future? One of the ways to invest for future costs is to pay for a better plan right now. Your premiums will be higher, but your out-of-pocket costs will be lower. Beyond that, consider taking advantage of a Health Savings Account (HSA). Money put into an HSA reduces your taxable income, and those funds grow tax-free until you use them to cover your health expenses.

• Is there anyone who can help me plan for healthcare costs? Healthcare has only gotten more complicated over the past decade, and navigating present and future costs can feel like a full-time job on top of your actual full-time job.

Luckily, financial advisors can help you gain control over your finances, factoring in healthcare costs and risk tolerance. Your wealth is, in many ways, inextricably tied to your health, so getting a financial advisor to help you secure both of these is always a good idea.

• How do I fit healthcare in around my job? Finding the time to take care of yourself and your family can sometimes be just as difficult as finding the money to afford it. Look into what kind of remote services are offered by your insurer. This can save you time and money. You’ll likely discover a whole host of digital options — from drug delivery to diagnoses — that can help you make time for yourself without taking too much time away from work.

Baby Boomers and the Case of the Comfortable Retirement

For many Baby Boomers, retirement is already here — or is quickly approaching — which means entering the convoluted world of Medicare and Medicaid. While these government services help cover costs in retirement, Medicare doesn’t cover everything. Just planning for those gaps in coverage alone can be a major stressor.

This anxiety is compounded by the fact that many younger Boomers are still taking care of their elderly parents’ health needs and have children still on their insurance plans. But it is possible to get a handle on what the next steps should be by asking the right questions:

• Where do you go to get health insurance? If you’re like most Baby Boomers, you’ve had health insurance through your employer for most of your life. Retirement makes it a bit more complicated. Luckily, at age 65, you’re eligible for Medicare.

You’ll need to do some research to make sure you’re choosing the right plans for you, however. Medicare comes in separate parts, A, B, C, and D, each covering different things. A and B are known as Original Medicare and cover hospital costs and other medical costs, respectively. Part D helps cover the cost of prescription drugs.

Part C, also known as Medicare Advantage, covers everything A and B cover (and usually more), but it tends to come with higher premiums. You can also opt for supplemental insurance, known as Medigap, which can be used in conjunction with A and B.

If that sounds like a lot of alphabet soup, you’re not alone. Luckily, your PCP and current insurance providers can help guide you through the process of choosing the right Medicare coverage for your needs.

• Do I need to start planning for long-term care? This can be a hard question, but it’s an important one. Much of long-term care is not covered under Medicare, which means you’ll need to find other ways to pay for it. If you haven’t already, start using an HSA. You might also consider changing the way you’re saving right now. If you can, switch to a Roth 401(k) or IRA because that income isn’t taxable in retirement.

You should also get more comfortable using a smartphone. This might sound trivial, but knowing what mobile services your provider offers can help you get the care you need. Plus, knowing your way around things like FaceTime and Skype can help combat feelings of isolation that are common in retirement.

Every Generation Wants Quality Care

Regardless of which generation you fall into, chances are you share some basic worries with pretty much everyone. You want to feel confident about your healthcare decisions, and you want to stay healthy without going bankrupt.

With that in mind, let’s look at a few strategies that can empower you to make the right healthcare decisions for your needs, regardless of where you are in life:

1. Be choosy when selecting your doctor.

Step one is prioritizing your needs in healthcare and finding a doctor who will do the same. Don’t just go with whatever doctor your plan assigns you or the closest one that’s in your network. Instead, do plenty of research.

That means looking at reviews online and talking with family members and friends. Don’t just look at qualifications — learn how your potential choices run their practice. What’s their bedside manner like? Are appointments kept, or are patients kept waiting? You’re not just choosing a doctor, you’re choosing a relationship that could have profound effects on your health.

2. Pay attention to your network of care.

It’s not just your doctor that should be in your insurance provider’s network. To keep costs low, you’ll want to keep as many of your health services as possible in your network. This includes everything from imaging facilities to emergency rooms to anesthesiologists. You should also take special care to make sure that any staff involved in elective surgeries are also within your network.

Don’t worry, though. If you’re suddenly faced with surprise out-of-network charges, there are some options to help you mitigate the costs. You just need to be proactive in pursuing them.

First, you can talk to your doctor’s office directly. You might be surprised at how often healthcare providers will work with you to lower their prices for services not covered by insurance. Failing that, you can call your insurance company, which might be willing to negotiate on prices for you.

If the price is still too high, you still have options. If you offer to pay for everything right away, your provider might be willing to give you a discount. If not, ask about payment plans. These organizations know how difficult it can be to pay hefty bills, and they would rather work with you than forcing you to dodge debt you can’t pay.

3. Cut your prescription drug costs where you can.

In 2018, it was estimated that Americans spent $335 billion on prescription drugs. Necessary medications continue to be a major source of financial pain for many.

If you’re one of the many Americans paying more than $50 for prescription meds every month, it’s worth taking the effort to find out what you can do to cut those costs. This might sound easier said than done, but you do have options — even if you can’t switch to a plan with better prescription coverage.

Mail-order pharmacies, for example, tend to sell prescriptions at a lower price because they have fewer overhead costs. And as an added bonus, they’re delivered right to your door.

There are also discount savings programs available. Drug companies sometimes offer discount options for certain drugs, and third-party websites like Health KarmaRx can help you find the best price available to you. Don’t forget to also always check with your doctor to see if there’s a generic option for your prescription. Some stores, like Meijer and Publix, even offer certain generics for free.

4. Take advantage of telehealth.

It shouldn’t surprise you to hear that telehealth has had a bit of a boom over the past year. While its popularity might have been due to the necessity of navigating COVID-19, its usefulness will far outlive the pandemic.

Not only are telehealth visits more convenient, but they also cost the same or even less than an in-office visit. That’s not even taking into consideration the time (and gas money) you save by not having to deal with a commute to and from your doctor’s office.

Navigating health insurance isn’t easy, but it is possible. If you find yourself completely lost when dealing with your healthcare, don’t hesitate to talk to someone. Your insurance provider, primary care physician, and family or friends are probably more than willing to help. We are, too.

Taking care of yourself is a journey, and we’re here to make that journey as easy and as stress-free as possible. Click here to find out more about navigating health insurance — and how we can make that process so much easier.