Health Insurance

The rising cost of medical care and the resulting pressure on health insurance premiums makes health insurance top priority if you want to have your health expenses covered at a reasonable cost. The current health insurance system is quite complex and constantly changing. The information below may help answer your questions:

What kinds of health insurance are there?

There are essentially two kinds of heath insurance: Fee-for-Service and Managed Care. Although these plans differ, they both cover an array of medical, surgical and hospital expenses. Most cover prescription drugs and some also offer dental coverage.

1. Fee-for-Service

These plans generally assume that the medical professional will be paid a fee for each service provided to the patient. Patients are seen by a doctor of their choice and the claim is filed by either the medical provider or the patient.

2. Managed Care

More than half of all Americans have some kind of managed-care plan. Various plans work differently and can include: health maintenance organizations (HM0s), preferred provider organizations (PPOs) and point-of-service (POS) plans. These plans provide comprehensive health services to their members and offer financial incentives to patients who use the providers in the plan.

How do I pick a health plan?

If your employer gives you a choice of plans or you need to purchase your own coverage, it is crucial that you understand your health insurance choices and pick the insurance that is best for you and your family.

Here are some questions you should ask yourself when choosing a health insurance plan:

How affordable is the cost of care?

What is the monthly premium I will have to pay?
Should I try to insure most of my medical expenses or just the large ones?
What deductibles will I have to pay out-of-pocket before insurance starts to reimburse me?
After I’ve met my deductible, what percentage of my medical expenses are reimbursed?
How much less am I reimbursed if I use doctors outside the insurance company’s network?

Does the insurance plan cover the services I am likely to use?

Are the doctors, hospitals, laboratories and other medical providers that I use in the insurance company’s network?
If I want to use a doctor outside the network, will the plan permit it?
How easily can I change primary-care physicians if I want to?
Do I need to get permission before I see a medical specialist?
What are the procedures for getting care and being reimbursed in an emergency situation, both at home or out of town?
If I have a preexisting medical condition, will the plan cover it?
If I have a chronic condition such as asthma, cancer, AIDS or alcoholism, how will the plan treat it?
Are the prescription medicines that I use covered by the plan?
Does the plan reimburse alternative medical therapies such as acupuncture or chiropractic treatment?
Does the plan cover the costs of delivering a baby?

What is the quality of the insurance plan I’m looking at?

How have independent government and non-government organizations rated the plan? For example, the National Committee for Quality Assurance ( http://www.ncqa.org ) issues a Consumer Assessment of Health Plans (CAHPS) report for every medical plan and facility.
What kind of accreditation has the plan received from groups such as NCQA or the Joint Commission on Accreditation of Healthcare Organizations (JCAHO) ( http://www.jcaho.org )?
How many patient complaints were filed against the plan last year and how many were upheld by state regulatory agencies like the state insurance commission or the state medical licensing board?
How many members drop out of the plan each year? State insurance departments keep track of “disenrollment rates.”
Do the doctors, pharmacies and other services in the plans offer convenient times and locations?
Does the plan pay for preventive health care such as diet and exercise advice, immunizations and health screenings?
What do my friends and colleagues say about their experiences with the plan?
What does my doctor say about his or her experience with the plan?

Can I buy an individual policy?

Yes. If you are unemployed, self-employed, or decide to return to school you may want to buy an individual health insurance policy.

Here are a number of options that you may consider:

1. Ask your insurance company if you can convert its group policy to an individual policy. You will pay a higher rate than you did before and your benefits may be limited, but the terms will still probably be better than if you buy your own policy.

2. If you are married, see if your spouse’s employer will add you to its group plan.

3. Try to join a group health plan through a trade association or alumni group or professional association may offer reasonable rates. If you are over age 50, you can join the American Association of Retired Persons (AARP), which offers an extensive plan. Even some credit card companies offer health insurance coverage.

4. As a last resort, you can buy an individual policy. The rates will be high and coverage limited, but it is important that you be protected against financial catastrophe if you or your family are hit with a major illness or injury. If you are self-employed, most of the health insurance premium will be tax-deductible.

To find the best policy, contact a health insurance agent or broker who will help you find the contract that gives you the most for your money.

If I change jobs or become unemployed, can I bring my coverage with me?

If you switch employers, you have the right to carry your group health insurance coverage with you to a new job for up to 18 months under the Consolidated Omnibus Budget Reconciliation Act (COBRA).

You must pay the full premium, but at group rates that are far cheaper than the individual rates you would pay for similar coverage. Health insurance under COBRA is available if you are in the following situations:

You leave a company and become unemployed or self-employed for up to 18 months.
You are a widow or widower or child of an employee who dies while working for the same company for three years or more.
You are the divorced spouse or child of an employee who has left the company he or she was employed at for at least three years.
You are the child of an employee who left a job and have not yet reached age 23.

NOTE: If you need COBRA benefits, you must fill out the appropriate forms from your employer’s benefits department within 60 days of leaving your job. If you do not act within that time, you may be denied coverage.