Family health insurance plans are the same concept as an individual health insurance plan; however, the critical difference is that family health insurance plans will cover multiple individuals. Many dependents, such as spouses, naturally born children and legally adopted or foster children, can be covered under one health insurance plan. The best family health insurance plans include Preferred Provider Organization (PPO), Health Maintenance Organization (HMO), Exclusive Provider Organization (EPO), and Point-of-Service Plans (POS), and High-deductible Health Plans.
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Best Family Health Insurance Plans
Family health insurance plans are a great option to consider if you and a partner are considering growing a family in the future; however, navigating the vast array of health insurance and the costs can seem daunting.
When considering the best family health insurance plan for your family, it is essential to consider the following factors:
- The size of your family
- The overall health of your family
- Your budget
For example, with a growing large family comes more significant chances of accidents or illnesses to occur. Because of this, your finances could potentially be impacted even worse due to unexpected medical expenses if you do not have health insurance. This is where the type of health insurance plan you utilize comes into play.
Below is a list of the most common health insurance plans and a breakdown of what each entails so that you may be able to evaluate better which plan will satisfy your family’s needs:
- Preferred Provider Organization (PPO)
- Health Maintenance Organization (HMO)
- Exclusive Provider Organization (EPO)
- Point-of-Service Plans (POS)
- High-deductible Health Plans (HDHP)
Preferred Provider Organization (PPO)
PPOs are one of the most popular family health insurance plans. They allow for the most flexibility in terms of access specialists without referrals and not being tied down to one specific primary care provider (PCP). However, this flexibility comes at the cost of higher monthly premiums and occasionally deductibles. Because of this plan's flexibility, a PPO may be best suited for large families. They are typically more at risk of utilizing more specialists or having a more comprehensive range of PCPs.
As a member of a PPO plan, you and your dependents will have access to a wide range of in-network PCP’s that you will be eligible to visit. With a PPO plan, you will also have access to out-of-network benefits, just at a slightly higher cost than in-network visits. This means if you were to visit a doctor who is out of network with your plan, you might have to pay 60% of the cost, and your project will pay for 40% of the expenses. If your goal was in-network with the PCP, these costs might be reversed.
Additionally, if you would like to see a specialist such as a dermatologist, you or your dependent will not have to be referred by a PCP first. By bypassing this referral, you will save additional time and doctor visits before obtaining access to specialized care. All of these benefits come with slightly higher premiums, and oftentimes, you will have to meet your deductible before PPOs begin covering your medical visits. Nonetheless, if you have a large or illness-prone family and have the ability to afford a PPO, this plan may be worth it for you.
2. Health Maintenance Organization (HMO)
HMOs are typically the most affordable form of family health insurance plans. With this lower cost, comes an increase in rigidity in terms of seeing a PCP or specialist. HMOs require you to have one PCP, referrals, and you will not have access to out-of-network benefits. Because of this combination, an HMO may be a better option for a smaller or relatively healthy family, as your pool of PCPs and access to medical care will be limited due to lower costs as a whole.
Unlike PPOs, you and your dependents would have one in-network PCP. If you or your dependents would like to access specialized care, you must first go through this PCP and obtain a referral before seeing a specialist. Because of this process, individuals may feel slightly limited in their abilities to access the healthcare they need.
In addition, HMO plans do not have out-of-network benefits, which means if you go to a provider who does not accept your plan, you will be left paying all medical costs. Similar to this out-of-network system with accessing healthcare providers, it may be more difficult to fill a prescription under an HMO plan, as HMO plans are limited to a network of pharmacies. The flip slide to these limitations is that the costs for an HMO are often lower when compared to other plans. They don’t usually have deductibles, and clients are only charged copays when accessing a service.
3. Exclusive Provider Organization (EPO)
EPO plans are not quite as flexible as PPOs, yet not as rigid as HMOs. You do not receive out-of-network benefits in an EPO plan, but you do not need one PCP or a referral to see a specialist like HMOs. The catch with EPO plans is that you must ensure there are viable EPO providers in your area. An EPO plan may be a quality alternative for a large or illness-prone family, as it allows for a broader range of providers at a lower cost.
Unlike HMO plans, you do not need to have one sole PCP for an EPO plan, which means you will have access to a greater range of physicians. Additionally, with an EPO, you will be able to see a specialist without a referral; the specialist must be in-network with your plan. This greater access to medical care, like with PPO plans, can allow for better healthcare coverage for your family, which is a draw for EPO plans.
Like HMOs, there will be no healthcare coverage from an out-of-network provider with an EPO. Thus, if you or your dependents are likely to need additional care, this plan may end up being more expensive. When considering an EPO, make sure also to verify if there are viable providers nearby. EPOs tend to have smaller networks than PPOs.
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4. Point-of-Service Plan (POS)
POS plans are less commonly used plans and can be viewed as a mixture of the PPO and HMO plans mentioned above. You see an in-network PCP in a POS plan and must have a referral to see a specialist. Nonetheless, you can also see PCPs who are out-of-network. POS plans may be the right fit for a family with dependents dispersed throughout the U.S., as it allows for out-of-network benefits if an emergency arose for your dependent and no other in-network providers were nearby.
A considerable advantage to a POS plan is that members possess the freedom to see doctors who are out-of-network with their plans. This can reassure members who believe they may need to seek extra medical attention and want a larger pool of physicians to draw from. However, with these out-of-network benefits comes extra provider’s fees upfront, which may be a difficult cost to front and can lead to additional paperwork for patients attempting to see these providers.
If you or your dependent see specialists often, though, this plan may not be worth it as you would have to go through the referral process, which tends to be time-consuming for many individuals. Because of this, POS plans tend to be more affordable, as they have no deductibles, low co-pays, and premiums that are half the cost of PPOs.
5. High-Deductible Health Plan (HDHP)
These plans are unique in that they require individuals to pay a higher deductible of at least $2,800 for families. These plans usually have higher out-of-pocket costs but lower premiums. This implies that members will pay for more of their healthcare costs (hit their deductible) before their plan begins to cover them. An HDHP may be a perfect option for younger and smaller families who can put money into an HSA, an account where pre-tax money for medical expenses can be stored. For those with chronic conditions or in larger families, the out-of-pocket costs that come with an HDHP may not be worth it.
Similar to PPOs, HDHP plans allow for out-of-network benefits in terms of being able to PCPs, just at a possibly higher cost. Additionally, HDHP members do not need a referral to see a specialist. These medical factors allow for a wide range of healthcare access and benefit families who need this less narrowed network.
The difference between the PPO plans and HDHP plans is just how the visits are paid, as HDHPs tend to have lower costs on premiums but higher costs on deductibles and out-of-pocket deductibles (and PPOs are the opposite of this). Thus, if you need to see a doctor frequently, the prices of an HDHP plan may become too high. If you and your dependents rarely utilize health benefits, you could save money with this plan.
Best Family Health Insurance Frequently Asked Questions (FAQs)
To help you better understand the minute details of family health insurance, below are a few definitions and commonly asked questions to guide you:
How do I know which health insurance plan is right for my family?
It is all entirely up to you. There are pros and cons to every plan, but at the end of the day, you are the one in charge of evaluating different plans and determining which you think will best suit you and your dependents’ needs. Some factors to guide your evaluation include the size of your family, cost of plans, and overall relative health of your family.
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What is a premium?
A monthly premium is a cost you pay per month to remain on your insurance plan. These rates will vary across insurer and plan types, as seen with the different sorts of family health insurance plans. Your monthly premium is based on you and your dependents’ medical needs, state, and income.
What is a deductible?
A deductible is a fixed amount that you will have to pay before your insurance covers your care. Occasionally, an insurance provider will cover screenings or preventative care regardless of whether or not your deductible has been met.
The one principle that can be kept in mind when selecting a family health insurance plan is that each family will require different needs. Because of this, family health insurance plans can grow to be expensive and difficult to navigate based on the variety of aspects that need to be considered (relative health of dependents, age, number of dependents, etc.).
However, Mira may be the perfect option for you and your family, as it allows you to access family healthcare at a lower price, regardless of whether or not you are employed.
Madeline is a Senior at UCLA majoring in Human Biology & Society with a minor in Spanish. She's currently a Healthcare Research Analyst at Mira, writing content for the blog to help the public better understand certain medical issues, technologies, testings, and the importance of healthcare.