Steps in Choosing a Health Care Plan

Plans with more restrictions tend to be cheaper. For example, HMOs have lower premiums, but you'll need to choose providers from their networks. You'll need referrals to see specialists and prior authorization before you can get tests and other services. (This means you have to get the OK from your plan in advance.) Other options, like PPOs, are more flexible, will let you see more doctors, and may not require a referral to see a specialist, but have higher premiums.

When comparing plans, look at each plan's list of in-network providers and hospitals. You'll see if your current doctors work with the insurance company, meaning visits will be covered. If you take prescription medications, look at each plan's formulary, the list of drugs it covers. You'll be able to plug in the drug name and dosage to see what the costs will be.

Public Marketplace options are divided into silver, bronze, gold, and platinum levels. As you go up in metal category, both the benefits and the costs go up. As a general rule, the healthier you are, the lower the level you need. On the other hand, if you have many chronic or serious conditions, a plan with more benefits could end up being the most cost-effective choice.

Depending on your income and the number of people in your family, you may be eligible for a premium tax credit to lower your monthly premium on a Marketplace plan. You might also qualify for cost-sharing reductions to further lower the costs if your income is roughly between 100% and 250% of the federal poverty level. Note that if you don't qualify for these credits, you can also  look outside the Marketplace for a private plan.

The deductible is the out-of-pocket expenses you'll have to lay out before insurance kicks in. One way to get a lower premium is to choose a high-deductible health plan, or HDHP. These plans require that you spend thousands of dollars before they cover costs, but you'll save monthly on premiums. Catastrophic plans sold on the Marketplace cover three primary care visits before you are required to meet the deductible. This option is available through private insurance companies as well as certain plans in the Marketplace, notably the silver level. If you're in good health, this may be for you.

A health savings account, or HSA, is a special type of account that you fund with pretax dollars – income before any taxes are taken out. You then use these savings for health care expenses you must pay before you reach your deductible. The money can be placed in an interest-bearing account or even invested in stocks, so it can grow over time, even funding health care costs after retirement. You're eligible to open an HSA only if you choose a high-deductible health care plan.

When comparing health care plans, check medication coverage specifics. Getting your prescriptions by mail order, usually a three-month supply, can be a lot less expensive than going to your local pharmacy. Many generic drugs bought this way come at a very low or no cost. When you need a prescription right away for an acute illness, the plan may have a preferred pharmacy partner where it will cost less.

Good health is like money in the bank. As you look at plans, compare the free preventive services offered, from wellness visits and immunizations to cancer screenings and beyond. Most plans include a core set of benefits, but some go further with perks like nutrition and smoking counseling and discounts for non-covered services like eyeglasses and gym memberships. Once you choose a plan, take advantage of these free services to stay healthy.

A healthy diet and regular exercise go a long way toward avoiding serious and expensive illnesses. Once you've chosen a plan, maximize wellness visits by asking your doctor for fitness advice. If you're on medication for a condition, stick with it to control the illness. It sounds like a no-brainer, but medication compliance is hard for many people. If you take medications that aren't covered by your plan, check the drugmakers' websites for discounts like copay cards or patient assistance programs to help with costs.

Commercial health insurance providers must offer this online tool, which can be a real money saver. It lets you see the health care costs for hundreds of common medical services and procedures with different providers and at different facilities so you can choose wisely. This is especially important if you have a high-deductible plan and must minimize out-of-pocket costs.

Going to an emergency room for a minor problem can be very expensive. Unless you're having a true emergency, like a possible heart attack or a life-threatening accident, call your provider before seeking care. They may be able to see you or suggest an urgent care center. This is another way to cut health care costs.