For better or worse, most of what you already know about health insurance isn’t changing next year.
The good news is that you won’t need to relearn the basics if your plan is changing in 2025. The bad news is that the risk of unexpected bills remains, in part because the fine print for most policies “can get very complicated,” said Gary Young, director of the Center for Health Policy and Healthcare Research at Northeastern University.
This year, frustrations are running especially high. The killing of UnitedHealthcare CEO Brian Thompson has triggered an outcry against a health insurance industry that’s already under fire from Congress over its role in prescription drug pricing. In the meantime, millions of people are struggling with medical debt as the costs of care continue to outrun inflation.
Here’s what to know to help keep your health care costs down in the year ahead, whether you’ve already received your new insurance card or are still shopping for coverage.
For starters, get covered
Some 164.7 million Americans receive health care benefits through their employers, KFF estimates. For many of them, the open enrollment period has been over for weeks, and they’ve already selected new coverage options or been automatically re-enrolled in their existing plan.
Another 21 million people selected coverage through the federal healthcare.gov portal last year. Open enrollment on that marketplace kicked off in November and runs until Jan. 31, meaning there’s still time to purchase your own insurance plan. So if you haven’t done so yet and intend to, make that your first priority this January.
Make sure your providers are still in network
Most insured people are familiar with in- versus out-of-network costs, which arise from the discounted rates health plans negotiate with doctors and hospital systems. But some patients don’t realize there’s always the risk that practitioners they’ve seen for years could slide out of their insurance network. The start of the year is a great time to check.
“It’s important to look at your plan documents ahead of time,” said Michelle Long, a patient and consumer protections analyst at KFF.
You can either call your provider and ask, or search your plan documents, most of which are typically available online, Long said. Insurers are also required to list their in-network providers and pharmacies, which you can usually find via search tools on their websites. To anticipate charges, providers must also provide an estimate upon request for what certain services will cost.
Patients do have some safeguards in emergencies. A federal “no surprises” law that took effect in 2022 limits costs for, say, a surgery performed by an in-network doctor that requires medication from an out-of-network anesthesiologist.
“You didn’t choose to go to an out-of-network hospital or provider, but that’s where you ended up because you were in an emergency,” Long said. “In those cases, you should be protected from that balance billing.”
Some states have their own laws that apply to all marketplace plans and some employer-sponsored ones. However, Long warned that you might not be protected by certain state laws if you’re among the 63% of people with employer-sponsored insurance who have “self-funded” plans. You can check whether your plan is self-funded or “fully funded” — meaning your employer pays a fixed monthly premium to the insurer — in your plan documents.
At any rate, insurers sometimes overbill patients, Long said. “If you think you are being denied coverage or are required to pay more than you thought you should have, you are entitled to appeal,” she said.
Review your medications
Insurance companies’ “formularies” dictate which drugs they cover, but what lands on those lists is sometimes a mystery — a point of political contention as drug companies and the middlemen that oversee prescription benefits face heightened scrutiny.
In July, the Federal Trade Commission accused these pharmacy benefit managers of inflating drug costs by excluding cheaper generics from their formularies; the PBMs have denied that. The FTC also sued the three biggest PBMs in September, accusing them of artificially raising insulin prices, which the companies have denied.
Still, your insurer is required to disclose your plan’s formulary, so Long suggests checking it to see if your prescriptions are covered. If not, you could be stuck paying out of pocket — but might still have options. Sometimes doctors prescribe a brand-name drug when a generic exists, and if so, your pharmacist can determine whether such an alternative is covered. It could save you money.
There’s good news for older adults on Medicare: A new $2,000 annual cap on out-of-pocket prescription drug costs is taking effect in 2025, due to a provision in the Biden-Harris administration’s signature Inflation Reduction Act. That rule is particularly expected to benefit cancer patients, who face steep costs for many of the drugs they’re prescribed.
Look up the fees you’re on the hook for
Your deductible — the amount you have to pay each year before your plan starts picking up the tab — could have changed even if you re-enrolled in the same benefits this year, so it’s always worth checking.
The average deductible for employer-sponsored plans in 2024 was $1,787 for single coverage and $4,991 for family coverage, according to KFF. The average deductible for marketplace plans is higher, at $3,057, but they vary depending on the “metal level” of the plan; most people choose “silver,” with a deductible of $5,241.
If you’re hunting for a new plan, Young advised considering how often you incur health care charges. High-deductible plans tend to have low premiums, or monthly fees, but any chronic conditions that require frequent visits or prescriptions could make a higher-premium plan more cost-effective, since it’s likely to come with a lower deductible and more robust coverage.
After you hit your deductible, some plans will still require you to cover a certain amount (a copay) or percentage (coinsurance) of each bill. Copays and coinsurance are more common in low-deductible plans, especially for prescription medications, emergency room visits, inpatient hospital stays, diagnostic imaging and other services.
“Coinsurance can be really tricky, and that’s one way you can end up with a really big bill that you didn’t anticipate,” Young said. A common coinsurance is 80% paid by the insurer.
So for instance, she said, “if a doctor charges $2,000 for whatever services they’ve provided, you’re on the hook for 20% of that” — or $400 — “and that’s not nothing.”