Best Health Insurance in New Jersey

Useful Terms to Know

Annual Deductible: This is the amount you have to pay for health care before insurance kicks in at 100 percent.

COBRA: The Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA) allows individuals to continue benefits with their employer after they have ended their employment. The individual extending their coverage becomes responsible for 100 percent of the health insurance premium.

Coinsurance: This is the percentage of cost that individuals pay for health care services.

Copay (Copayments): When you go to the doctor or hospital, the copay is the set amount they will charge you at the time of service.

EOB: This is the Explanation of Benefits (EOB). It outlines the network price negotiated by the insurance company, how much the insurance company covers, and the remaining balance to be paid.

Exchange: Health insurance plans are sold in marketplaces called exchanges. Each state has its own health insurance marketplace or exchange. Plans sold at the exchanges are sometimes referred to as on-exchange plans. These plans have to meet higher requirements to be sold on-exchange. There are also off-exchange plans. These plans still have to meet the basic requirements set forth by the Affordable Care Act, but they have more flexibility.

Health insurance premium: A health insurance premium is the monthly cost of health insurance. It is tax deductible.

Health Savings Account (HSA): A health savings account is money set aside before taxes to pay for health care services. The funds in health savings accounts can only be used for medical expenses or paying medical bills. Many high deductible plans come with the option to put money aside into an HSA. Unlike a Flexible Spending Account (FSA), the funds in a health savings account can be used year to year. It is a great way to save money while paying for health care.

Network: The network is a group of physicians and hospitals that accept the health insurance company’s insurance. They have discounted the cost of medical services for the health insurance company.

Open enrollment: Open enrollment is the time period in which you can enroll in a health insurance plan for the following calendar year. There are great ways to prepare for open enrollment and some pitfalls to avoid. Open enrollment is November 1 through December 15.

Out-of-pocket expenses: This is how much you pay for health care after your health care coverage kicks in.

Out-of-pocket maximum/Out of pocket limit: This is the maximum that you will pay for health insurance in one year. It includes co-payments and the deductible. Once this amount is met, any additional health services you receive are covered by the insurance company.

PCP: A primary care physician is the general doctor who takes care of your most essential and basic check-ups and health needs. PCPs can refer you to specialists if necessary.

Pre-existing condition: These are health conditions or illness that existed prior to an individual seeking health insurance and conditions that an individual has already seen a doctor for.

Qualifying health insurance: Health insurance plans have to meet certain coverage and cost requirements to be considered qualifying health insurance under the Affordable Care Act. Minimum Essential Coverage (MEC) is another term used to describe qualifying health insurance.

Special enrollment period: If you are going through a change in life, like having a baby, you are allowed to update or change your health insurance plan.

Subsidies: If your income is between 100 and 400 percent of the federal poverty line, you may qualify for a tax credit subsidy on your insurance premium. It makes a monthly premium more affordable.

VA health benefits: The government provides health insurance to military veterans through the Veterans’ Affairs Office and its hospitals.

Need more help with health care acronyms?

Health Insurance Laws

The Affordable Care Act or Obamacare made many changes to the health insurance industry. Court cases can affect the interpretation and implementation of certain laws. New laws can be passed to make additional changes. Federal laws are consistent throughout the United States, while state laws can vary state to state. It is important to be up to date on the health insurance industry before choosing a health insurance provider and plan.

Under the Affordable Care Act, all health insurance plans must cover the following:

• Outpatient care
• Prescriptions
• Emergencies
• Mental health care services
• Hospitalization
• Rehabilitative and habilitative services
• Preventive treatment and wellness check-ups (like an office visit)
• Laboratory work
• Children’s healthcare
• Mother and infant care

These kinds of medical care are considered essential health benefits. States may also have their own additional health insurance rules.

On-exchange Versus Off-exchange

When purchasing a health insurance policy, you can choose from two categories: on-exchange plans and off-exchange plans.

The government runs health insurance marketplaces, or exchanges, in each state. Plans must meet certain criteria to be offered on the exchange. Government subsidies are accepted by plans on the exchange.

Off-exchange plans are not sold on government-run health insurance exchanges. They still have to meet some federal requirements and must be qualifying insurance. There are more plan options off the exchange.

Types of Health Plans

HMO: Health Maintenance Organization (HMO) health insurance plans have especially good health care coverage for preventative care in network. All of your health care needs go through a Primary Care Physician (PCP). If you need to see a specialist, your PCP must refer you to one first. The premiums for HMOs tend to be low, though out-of-pocket costs can be higher.

PPO: Preferred Provider Organization (PPO) health insurance plans provide coverage in-network and out-of-network. In-network coverage is usually greater than out-of-network coverage. PPO plans offer greater flexibility in seeking care and generally have larger networks. No referral is needed to see a specialist.

PPO premiums are higher, but the overall coverage is greater. This means, there are greater discounts and insurance pays more for health care services.

EPO: Exclusive Provider Organization plans offer some of the flexibility of a PPO plan while offering lower premiums. EPO plans only cover in-network service. A referral is not needed to see a specialist.

POS: Point of Sale plans offer in-network and some out-of-network coverage. POS plans require referrals to see specialists.

Other kinds of plans are more specific in their coverage. Short-term health insurance plans can provide health insurance coverage for short periods of time. If you’re changing jobs or need short-term coverage while you wait for other insurance to kick-in, then short-term plans are a good option.

Catastrophic plans were made available under the Affordable Care Act. They are only for people under 30 years old. These plans have low premiums and a high out-of-pocket limit.

Most employers offer health insurance as part of their benefit package for full-time employees. Some offer employer-sponsored health insurance for part-time employees as well. If you already have insurance through your employer, you probably do not need additional coverage.

Specific Government Health Insurance Programs

CHIP: The Children’s Health Insurance Program is a government program to provide children 18 years or younger with health insurance coverage. It is for families who do not qualify for Medicaid and cannot afford private health insurance.

Medicaid: Medicaid is government-provided health insurance targeted for people who are low-income and meet other requirements. Medicaid covers low-income families, the elderly, and people with disabilities.

Medicare: Medicare is government-provided health insurance for people 65 years old or older. There are plan options within Medicare. Parts A and B of Medicare cover preventative care, hospitalization, hospice, and other medically necessary procedures.

Parts C and D provide additional coverage. Part D provides prescription drug coverage. Before receiving care, double check to make sure it’s covered.

Medigap: Medigap is supplemental health insurance coverage from private companies for people 65 years old or older. It provides additional coverage to people on Medicare to help with copays, deductibles, and coinsurance.

Subsidies: The Affordable Care Act offers financial assistance for qualified health plans to low-income people. These subsidies make it easier to find affordable health insurance. The subsidies apply to the monthly premiums.

Choosing a Health Insurance Policy

Consider the following when evaluating your health coverage options.

• What are your individual and family’s health needs?
• Do you travel a lot?
• What does your budget look like?

If you or your family have significant health care needs, then paying higher health insurance premiums for more coverage may be the best option for you.

If you travel often, you may want to opt into a policy with some out-of-network coverage. That way, in the event of an emergency on a trip, you have some coverage.

Children can stay on their family’s health insurance policy until they turn 26 years old. If you are away from family, the coverage may not be as good because you’re out-of-network. Understand what your family’s health insurance covers before determining if and what kind of additional health insurance you need.

Note: Vision coverage (eye check-ups, glasses, contacts) and dental coverage are generally separate kinds of coverage. They can be purchased independently from health insurance.

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