5 Things You Should Know Before You Choose Your Health Insurance Policy

Millions of Americans pay health insurance premiums every month without fully understanding what their plan actually covers, and that gap in knowledge can cost thousands of dollars when a real medical need arises. According to the U.S. Census Bureau’s 2025 health coverage report, roughly 25 million Americans remained uninsured as of the most recent survey period, and many more are underinsured. Here are 5 things you should know before you make a final decision on which health insurance you choose.

1. What type of plan are you considering? Every insurance company has something different to offer, and the plan structure shapes nearly every other aspect of your coverage. The four most common plan types are Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPOs), Exclusive Provider Organizations (EPOs), and High-Deductible Health Plans (HDHPs), each with distinct network rules and cost structures, as explained by HealthCare.gov’s plan type guide. HDHPs are frequently paired with a Health Savings Account (HSA), which allows you to set aside pre-tax dollars for qualified medical expenses; the IRS set the 2026 HSA contribution limit at $4,300 for individuals and $8,550 for families, according to IRS Publication 969. Think carefully about what the policy needs to do for you and your family, medical expenses, prescriptions, surgical care, and any follow-up treatment. Post-surgical therapy is a detail many people overlook until they need it.

Premium figures are national averages for ACA marketplace silver-tier plans, sourced from KFF’s 2026 Marketplace Premium Analysis. Individual results will differ based on age, location, and tobacco use.

2. What does your policy cover or not cover? Coverage details matter far more than most buyers expect. Some health insurance plans cover physical therapy only while you are hospitalized (inpatient therapy), leaving you to pay out of pocket for outpatient rehabilitation. Your employer’s plan may not include pharmacy coverage at all, and even plans that do cover prescriptions maintain a drug formulary, a tiered list that determines which medications are covered and at what cost. Under the Affordable Care Act (ACA), insurers are required to cover ten categories of essential health benefits, including prescription drugs, mental health services, and preventive care, as defined by the Centers for Medicare and Medicaid Services (CMS). However, specific drug formularies still vary by plan, and certain specialty medications may require prior authorization or step therapy before coverage is approved. Some plans, for example, do not cover inhalers for asthma as a standard benefit, instead charging $50–$70 per inhaler because the insurer classifies the medication as non-universal. If you rely on any specific drug or device, verify its coverage before you enroll. The U.S. Department of Health and Human Services (HHS) provides a summary of what ACA-compliant plans must cover, which is a useful baseline when comparing policies.

One honest caveat worth knowing: short-term health plans and some grandfathered employer plans are exempt from ACA essential health benefit requirements. They may look affordable on paper, but they can legally exclude mental health coverage, prescription drugs, and maternity care entirely. These plans are not a good fit for anyone managing a chronic condition or planning a family.

The Kaiser Family Foundation’s 2025 Employer Health Benefits Survey notes that even within ACA-compliant plans, drug formularies can vary dramatically, a medication covered at a low copay under one plan may require full out-of-pocket payment under another. Always check the plan’s formulary before open enrollment closes.

3. How Much Does Your Plan Cost? Cost is an important aspect of your plan so that you can get health coverage while having an understanding of what you can afford. The plan has to make sense for your personal needs, and it also has to make sense for your budget. When evaluating total cost, look beyond the monthly premium and factor in the deductible (the amount you pay before insurance kicks in), copays, coinsurance, and the annual out-of-pocket maximum. For 2026, ACA-compliant plans cap out-of-pocket costs at $9,200 for individuals and $18,400 for families, according to CMS guidance. Tools like the HealthCare.gov Plan Finder and resources published by the Consumer Financial Protection Bureau (CFPB) can help you model your total expected annual cost based on your anticipated healthcare usage. Go through the entire checklist of the coverage it offers, and if it covers what you need at a price you can sustain, you can feel confident moving forward.

4. Can You Keep the Same Doctors? Once you have been seeing the same doctor for a specific condition, continuity matters. Always research the plans to ensure that the doctors you currently see are part of your plan’s provider network. A simple phone call to the doctor’s office, asking directly whether they accept your specific plan from your specific insurer, is more reliable than an online directory. Large national insurers such as UnitedHealth Group, Anthem (Elevance Health), Aetna, Cigna, and Humana each maintain different provider networks, and a physician who is in-network under one carrier may be out-of-network under another, a difference that can result in substantially higher costs. The No Surprises Act, enforced by CMS and HHS, provides some protection against unexpected out-of-network bills for emergency care, but it does not eliminate the need to verify your doctor’s network status before receiving non-emergency services. In group practices where several physicians share an office, not every doctor may be on the same insurance panels. Always confirm with the specific provider you see, not just the practice name.

5. What is availing care, and how much will it cost you? Availing care refers to treatment or services that a patient needs or would benefit from, anything a doctor deems useful or medically appropriate. Once a test or type of therapy is ordered, it is sent to the insurance company to determine whether they deem it necessary, a process formally known as prior authorization or utilization review. The American Medical Association (AMA) has documented growing concerns about prior authorization delays affecting patient care, with their 2025 survey finding that 93% of physicians reported care delays tied to prior authorization requirements. In some cases, disputed requests go before a review board before a final determination is made. If your insurer denies a claim, you have the right to appeal under federal law, and the U.S. Department of Labor (DOL) outlines the appeals process for employer-sponsored plans.

Getting health insurance quotes gives you a clear picture of what to expect in the months and years ahead. You should understand what type of coverage you have, what it includes, and how much it will cost. As you research your new plan, pay equal attention to what it won’t cover so you can set money aside for expenses that fall outside your benefits. Ask questions, take notes, and lean on people you trust as you work toward the best policy for your situation.

Online research is one of the most effective ways to build that knowledge base. Resources from the National Association of Insurance Commissioners (NAIC) and the Benefits.gov federal portal are solid starting points for comparing plan structures and understanding your rights as a policyholder. There are many things you’ll need to know before you make your final decision.

Frequently Asked Questions

What is the difference between a deductible, a copay, and an out-of-pocket maximum?

A deductible is the fixed amount you pay for covered services before your insurance begins paying. A copay is a flat fee (for example, $30) you pay at the time of a medical visit, regardless of whether you have met your deductible. The out-of-pocket maximum is the most you will have to pay in a plan year; once you reach it, your insurer covers 100% of covered costs. For 2026, ACA plans cap out-of-pocket costs at $9,200 for individuals and $18,400 for families, per CMS.

What are the main types of health insurance plans?

The four most common plan types are HMO, PPO, EPO, and HDHP. HMOs require you to choose a primary care physician and get referrals for specialists but tend to have lower premiums. PPOs give you more flexibility to see out-of-network providers at a higher cost. EPOs are similar to PPOs but do not cover out-of-network care except in emergencies. HDHPs have higher deductibles but lower premiums and are the only plan type compatible with a tax-advantaged Health Savings Account (HSA).

How do I find out if my doctor is in-network?

The most reliable method is to call your doctor’s office directly and ask whether they accept your specific plan from your specific insurer. You should also use the insurer’s online provider directory, but always verify by phone because directories are not always updated in real time. The No Surprises Act (enforced by CMS since 2022) protects you from unexpected out-of-network bills for emergency care, but it does not apply to scheduled non-emergency appointments.

What is prior authorization and when does it apply?

Prior authorization (also called pre-authorization or utilization review) is a requirement that your doctor obtain approval from your insurer before providing certain services, tests, or medications. Insurers use it to confirm that the proposed treatment meets their criteria for medical necessity. According to the American Medical Association’s 2025 survey, 93% of physicians reported patient care delays due to prior authorization requirements. If a prior authorization request is denied, you have the right to appeal.

What is an HSA and how does it work with a health insurance plan?

A Health Savings Account (HSA) is a tax-advantaged savings account you can use to pay for qualified medical expenses. It is only available to people enrolled in a High-Deductible Health Plan (HDHP). Contributions are tax-deductible, growth is tax-free, and withdrawals for qualified medical expenses are also tax-free. For 2026, the IRS allows contributions of up to $4,300 for individuals and $8,550 for families, per IRS Publication 969. Funds roll over year to year and do not expire.

What are essential health benefits and are all plans required to cover them?

Essential health benefits (EHBs) are ten categories of services that ACA-compliant plans must cover. These include ambulatory patient services, emergency services, hospitalization, maternity and newborn care, mental health and substance use disorder services, prescription drugs, rehabilitative services and devices, laboratory services, preventive and wellness services, and pediatric services. Plans sold through the ACA marketplace and most employer-sponsored plans must cover all ten categories, as defined by CMS. Short-term health plans and some grandfathered plans are exempt and may offer far more limited coverage.

How do I compare health insurance quotes effectively?

Start by listing your expected healthcare needs for the coming year, regular prescriptions, specialist visits, planned procedures, and any chronic conditions. Then compare plans on five dimensions: monthly premium, deductible, copays and coinsurance, out-of-pocket maximum, and network coverage. Tools available through HealthCare.gov and the National Association of Insurance Commissioners (NAIC) can help you run side-by-side comparisons. Do not choose a plan based on premium alone; a lower monthly payment often comes with a much higher deductible.

What happens if my insurance denies a claim?

If your insurer denies a claim, you have the right to appeal the decision. For employer-sponsored plans, the U.S. Department of Labor outlines a formal internal and external appeals process. For marketplace plans, the ACA requires insurers to provide a written explanation of any denial and to offer at least one level of internal appeal and one level of external review. You typically have 180 days from the date of a denial notice to file an internal appeal. If the internal appeal fails, you may request an independent external review.

Can I get health insurance if I lose my job?

Yes. Losing job-based coverage is a qualifying life event that triggers a Special Enrollment Period on the ACA marketplace, giving you 60 days to enroll in a new plan. You may also be eligible for COBRA continuation coverage, which lets you keep your former employer’s plan for up to 18 months, though you pay the full premium yourself. Depending on your income, you may also qualify for Medicaid, which is administered jointly by CMS and individual state agencies with no open enrollment deadline.

What is the No Surprises Act and how does it protect me?

The No Surprises Act, which took effect January 1, 2022 and is enforced by CMS and HHS, protects patients from unexpected out-of-network bills in certain situations. Specifically, it limits surprise billing for emergency services, non-emergency services at in-network facilities when you had no reasonable choice of provider, and air ambulance services from out-of-network providers. Under the law, you pay only your in-network cost-sharing amount in these situations, and the balance billing dispute is handled between the provider and the insurer.

Is a high-deductible health plan a good choice for everyone?

Not necessarily. HDHPs work well for people who are generally healthy, rarely use medical services, and can afford to fund an HSA to cover the higher deductible if something unexpected happens. They are a poor fit for anyone managing a chronic illness, taking expensive medications regularly, or who does not have savings to bridge the gap before the deductible is met. The lower monthly premium can be misleading, if you need frequent care, your total annual spending may be higher than it would be under a PPO or HMO with a more predictable copay structure.