We recognize that making a decision on the best insurance coverage for you and your family is a challenging task. The National Association of Insurance Commissioners (NAIC) provides these tips to help you make the best choice of the options available for you and your family.
Whether you are part of the 153 million Americans who receive health insurance coverage from an employer, the more than nine million self-employed, or the almost 14 million unemployed, tough economic times, rising medical costs and new laws related to healthcare reform make now a great time to reeducate yourself about health insurance.
If you receive health insurance through an employer, consider the following before selecting a coverage plan this year:
• Look closely for changes: Don’t automatically renew the option you had before; many employers are making changes due to rising costs.
• Take advantage of wellness incentives: Find out if your employer offers a wellness program that includes money-saving incentives for healthy behaviors such as exercising regularly or not smoking.
• Check out tax-free savings: In addition to your health insurance coverage, you may be eligible to open a Flexible Spending Account (FSA) or a health savings account (HSA). And don’t forget about dependent care savings accounts.
If you are self-employed or if your employer doesn’t offer coverage, you face unique challenges in finding and keeping health insurance, but you still have choices.
• Spouse plan: Check about being added to your spouse’s or domestic partner’s employer plan.
• Individual insurance: Consider shopping for private insurance. This option allows you to customize care to your lifestyle, health and budget. New Pre-Existing Condition Insurance Plans (PCIP) could help if you have had trouble qualifying for coverage in the past. Plus, recent tax law changes make it possible to deduct the cost of premiums from your taxable income.
If you are unemployed, within the past year you were likely forced to determine how, or if, to continue your health insurance. Now is a good time to review your decision. If you’ve been out of work for some time and your income has taken a significant hit, you or your family members might be eligible for Medicaid or the Children’s Health Insurance Program.
Health Insurance for Your Life Stage
In addition to your work situation, your family structure and lifestyle also have an impact on your health insurance needs. Find the right fit for you.
• Young Singles: If you’re a recent college graduate and just entering the workforce, this is likely the first time you’re making your own health insurance decisions. Of course you have questions. What’s the difference between an HMO and a PPO? How long can you continue coverage on your parents’ health insurance policy? NAIC has answers.
• Young Families: A new spouse or baby can significantly change your health insurance needs and costs. In short, it’s not just about you anymore. Consider these tips to ensure you and your growing family are covered.
• Established Families: As your family matures, so do your health insurance needs. From maintenance drugs and braces to insurance for your college student, it’s important to know the facts.
• Seniors: Now that your children are grown, it’s more important that you focus on your own health. Make sure you have the right coverage before and during retirement.
Many other special health insurance considerations come into play for domestic partners, single parents, military, and seniors who are raising grandchildren. Knowing your options helps you save time, money and frustration.
What is Open Enrollment?
Open enrollment refers to the period of time during which all members of your group health insurance plan have the opportunity to enroll in certain benefit programs. During an open enrollment period, insurance carriers are required to accept all applicants of the group without underwriting or evidence of insurability. Open enrollment is generally only held once a year. If you miss your company’s annual open enrollment, you likely will not be able to enroll in your employer-sponsored health insurance program until next year. Certain exceptions apply for new employees or employees with life changing events.
Make sure to check with your human resources department to see when your company’s open enrollment period begins and ends, and when your policy goes into effect, and can discuss your concerns with the selected insurance plan.
Read and Understand the Materials
There are many different types of major medical plans typically offered by employers. For help understanding the fundamental differences between preferred provider organizations (PPO), health maintenance organizations (HMO), point of service plans (POS) or indemnity plans, go to the NAIC insurance education Web site, www.InsureUonline.org and click on the life situation that most closely matches your own. The health section includes basic information about each type of program. Plan materials will detail which medical providers (physicians, hospitals, labs, pharmacies, etc.) are considered in-network and out-of-network. They will also detail how much the insurance carrier will pay under each type of plan.
Before making a choice:
• Check to see if your current physicians and area hospitals are in the plan’s network. Using network providers generally will save money on your health care.
• Check to see if spouses or dependents are covered. Some plans will cover spouses and other dependents, while other plans will not.
• Read all of the plan materials thoroughly. Doing so will tell you what your rights and responsibilities are under each plan.
• Review any pre-existing condition exclusions and prior authorization requirements in the plan materials.
• If you take prescription medications, check them against the list of approved drugs in each plan booklet.
• If any part of a plan is unclear to you, ask for help from your human resources department or the insurance carrier.
• If you are not satisfied with the answers to your questions, contact your state insurance department. Go to www.naic.org/state_web_map.htm for a link to your state insurance department’s Web site.
Compare the Cost and Coverage of the Plans Offered
In this uncertain market, it’s important to carefully evaluate your healthcare costs when making your annual enrollment decisions. While one option might have high monthly premiums and a low deductible, and another might have a low premium but more out-of-pocket expenses, it could be misleading which plan is best for you until you do the figures.
To pick the best coverage, first calculate your healthcare costs from recent years and try to estimate what your costs might be for the coming year. Don’t forget to include the cost of doctor’s visits, daily medications and any procedures you might be planning.
Next, make a list of the premiums, out-of-pocket expenses and benefits under each plan. Co-payments, deductibles and additional charges for wellness care or specialists (e.g. chiropractic care, cosmetic surgery, etc.) are examples of out-of-pocket expenses that you are responsible to pay. Remember, if you use a medical provider that is out-of-network, you will generally pay more out-of-pocket expenses. Include these fees in your calculations.
Finally, decide how much you can afford to pay. Other things to keep in mind:
• Check for any annual limits and prior authorization requirements.
• Some prescription medications have higher co-payments than others and they might vary from plan to plan. Mail-order options might be available for maintenance drugs at a lower cost to you.
• If your dependents have health insurance coverage through their employer, school or the Veteran’s Administration, compare their costs and benefits to the family plans you are considering to ensure that you choose the best plan for every member of your family. Make the same type of comparisons for any dental or vision care plans that you are offered.
Visit the NAIC's Special Section: PPACA & State Insurance Regulation for the latest news regarding healthcare reform implementation efforts.
Visit HealthCare.gov for information from the U.S. Dept. of Health & Human Services (HHS).