You’re moving up in the world. You’ve been out of school for a couple years now and you might be making some good progress personally, professionally and financially as you establish yourself in the real world.  Along with the joys of getting older, there come some big boy/girl responsibilities:

It’s time to take responsibility for your own health insurance.

Experts agree: You need health insurance, plain and simple. “There’s a temptation to go without health insurance” for healthy young adults, says Doug Whiteman, insurance analyst at Bankrate.com. But in doing so, “you could be derailing your financial future,”

Estimated Costs for a broken arm with and without health insurance:

Without: $5k-$16K

With: $200-$3K

Whether you like it or not, you can’t stay on your parent’s health insurance for ever. There’s a hard stop when you turn 26 years old. What are your options?

  1. Insurance through your employer or spouse’s employer (if it’s offered)
  2. No health Insurance – 2017 penalty – $695 or 2.5% of income (whichever is higher)
  3. Buy your own health policy (making over 40k/yr)
  4. Buy your own health policy (partially subsidized by Covered California 20-40k/yr)

When should I apply?

The best time to apply is about 30 days prior to your birthday to ensure seamless coverage. The latest you can apply is 60 days after your birthday. If you wait longer than 60 days you will be ineligible to apply until the next “open enrollment” which takes place between 11/1 & 12/15 each year as part of the Affordable Care Act (Obama Care).

What plan do I pick?

There are a lot of different plans out there and the pricing can vary quite a bit. A few things to consider when choosing a plan:

  1. What plan do you currently have? What are you used to?
  2. How many times a year do you go to the doctor?
  3. Do you take any prescription medications?
  4. Do you like to see the doctor of your choice (PPO plans) or are you willing to lose a little flexibility to save some cost (HMO plans)?
  5. Are you comfortable with a high deductible catastrophic plan or do you prefer not having to worry about potential out-of-pocket medical expenses?

Which company do I choose?

There are a few solid companies out there to choose from (Health Net, Blue Shield, Anthem, Kaiser, Aetna, and United of Omaha to name a few). Here are some factors to help you narrow it down:

  1. If you see a particular doctor regularly you want to make sure he/she accepts the new health insurance policy (company) you’re applying for.
  2. How big is the company’s network of doctor’s “in-network” that you will have access to?
  3. Obviously price is a very important factor

How do I apply?

  1. If you know which company and plan you want you can go directly online to the insurance company website and purchase the plan (Over 40k/yr income)
  2. You can purchase the plan through Covered California (Under 40k/yr)
  3. You can purchase the plan through a broker (yours truly). There is no additional cost and you can get help comparing plans and applying for the one that fits your situation best.

It may not be the most exciting purchase you make this year but it could very well be the most important.

Stay healthy my friends!