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Navigating the Ocean of Health Insurance Coverage

Part of taking care of yourself and your family in modern America means providing the best healthcare you can. Guest blogger Donna Fincher is a Georgia resident with 27 years of experience negotiating with insurance companies on behalf of hospitals and physicians’ groups. Today she provides a crash course in navigating the stormy seas of the American health care system.

Selecting an insurance carrier and a plan that is right for you and your family does not have to be a complicated task. The sheer volume of insurance carriers and policies may seem overwhelming, but there are some things you may do to make the process easier. Taking an organized step-by-step approach will help you to make an informed decision.

First, examine your circumstances. Are you

  • Currently uninsured and selecting an individual policy?
  • Insured through your employer and choosing from the options offered by your employer?
  • Insured through your employer, but given no options?

Individual or Group Plan?

Choosing an individual policy means you can examine all the choices in the insurance market to make your selection. If your employer offers group coverage, typically you may have several options from which to choose, or your employer may choose the coverage for you. Often, larger companies offer several coverage options to employees, and smaller companies just have one plan for everyone.

Taking advantage of health insurance offered through your employer could be the most cost-effective way to go, as long as your employer is paying part of the premium. If your employer is not paying any of the premiums, you may be able to score a less expensive premium as an individual, particularly if you and your family are healthy. Group coverage through an employer takes into account the health histories of all employees; therefore if you are an exercise/health food freak with a resting pulse of 50, you still may pay a higher premium by being grouped with the overweight smoker in the cubicle next to yours.

It is also possible to insure your children separately. Sometimes teenagers and college-aged children who are in good health have very low premiums when insured separately instead of as part of a group that includes middle-aged individuals with health issues.

Educating yourself about the insurance choices that are available to you instead of just going with the one your employer chooses can help you make the most of your premium dollars by getting you the right coverage at a price you can afford. It is unwise to simply go with the cheapest plan. You may find out the hard way that the cheap plan covers very little of what your family needs. Cutting your household budget in another area to allow you to pay a little higher health insurance premium for better coverage may prove to be a worthwhile investment down the road.

HMO, POS, PPO or Traditional Policy–What’s the Difference?

The type of health insurance plan you choose is important, and it is vital that you understand how each one works before you make your choice. Most insurance contracts run for one year, at the end of which you may renew or change companies.

One of the least expensive plans is an HMO (Health Maintenance Organization). Although the plan is usually less expensive, you have a limited list of doctors and hospitals you must use to benefit from the plan. You will have to pay out-of-pocket if you venture outside of the list of providers that participate in your HMO. You will be required to select a primary care physician (PCP) you will see for all of your healthcare, and you will not be able to see any kind of specialist without a referral from your PCP, except in the event of an emergency. An HMO will most likely require you to pay a co-pay for doctor visits and may include a deductible (minimum, upfront amount) for hospital stays.

A PPO (Preferred Provider Organization) exercises less-stringent controls over your choice of doctors and hospitals. There is often a longer list of doctors and hospitals associated with the PPO. The premium is typically higher, but you do not have to visit only doctors on the PPO list. You may use doctor who are “out-of-network,” but you will pay a higher share of the cost than you would if you use an “in-network” doctor. Also, a PPO plan does not require a referral from a PCP in order for you to see a specialist. The premiums for PPOs are typically higher than HMO premiums.

Somewhere between HMO and PPO lies the POS (Point of Service) plan. As long as you stick with doctors and hospitals that are in-network, your POS plan will pay according to the policy; however when you visit a doctor or hospital that is not in-network, you will have to pay considerably more than you would with a PPO plan. You may go outside of your plan to see a specialist or other provider, but you may be subject to additional co-pays and deductibles. Most HMOs, PPOs and POS plans have a limit that you will have to pay out-of-pocket.

The most expensive health insurance plan is usually the traditional indemnity plan. You may visit any licensed practitioner or healthcare facility. There is not a limited list. You will need to know the list of covered services in this plan, and whether or not there are any services that are not covered, such as cosmetic surgery.

Look at your household budget, decide what is important to you in terms of healthcare providers, and choose your insurance plan.

Selecting a Policy

Before signing your health insurance contract, it is important that you read your policy carefully. You may want to schedule an appointment with your agent or insurance representative at your place of employment so that you can ask any questions you may have regarding your policy. The amount of your monthly premium is an important consideration. In order to keep your premium down, you might consider a higher deductible; however it is important you choose a deductible you can afford to pay in the event of an illness or accident.

There are a number of questions you may want to ask your agent or representative:

  • Are the doctors and hospitals you prefer in your policy’s network?
  • What is your co-insurance and what are your co-pays?
  • How are emergency room visits handled? Are they paid in full?  Do you have to pay a portion?
  • What is considered an emergency?  If your insurance company denies your ER claim stating it was not a true emergency, what are your options? (It is important that you do not use the emergency room for non-emergency treatment.)
  • Are major medical expenses and hospitalizations covered in your policy?
  • Are there any exclusions in your policy (e.g. plastic surgery, substance abuse)
  • What is the family out-of-pocket limit (the most you will have to pay each year)?
  • Are there limitations on pre-existing conditions?  (By law, there can be no limits on pre-existing conditions for people 19 years of age or younger).
  • Is preventive care covered at 100%?  If so, what procedures (e.g. checkups, mammograms, pap smears) are covered each year?  It is a good idea to take advantage of all covered preventive care as you are paying for these services with your premiums.
  • Does your plan include prescription medications, vision or dental care?  If so, what is the additional cost for this coverage?

Before selecting an insurance company, you may want to check the reputations of the company’s you are considering by checking an insurance rating website.

Coverage for Special Needs

Does anyone in your family have special needs?  If so, you may need to find out the coverage options for your family member’s special conditions. You will most likely want to find out if the specialist or specialists you need are participating providers on your policy. Does anyone in your family have a chronic condition or need to take expensive prescription medications?  If so, it is important to make sure these are covered in your plan. You may want to find out the co-pay for your medications. Is mental healthcare covered and if so, what is your cost share?

You should consider the location of the doctors and hospitals in your plan as you may not want to travel a long distance for your healthcare. Are there ObGyns on your plan or pediatricians?  You may want to make sure you have the kind of doctors you need in close proximity on your plan.

What do you do in the event of an illness or injury after hours?  Is your doctor a part of a practice that provides after hours service?  Is there a clinic or urgent care facility available for after-hours care, or do you resort to a hospital emergency room?  These are questions you will need to ask your agent or insurance representative.

In the event a healthcare service you received is denied by your insurance company as not medically necessary, what is your recourse?  How does the appeal process work?

Choosing an insurance company and a plan is a decision that warrants serious consideration. Aside from asking family and friends about some of the plans you are considering, you may also want to ask your doctor about the plans as well. Your doctor’s staff may have experience with the insurance companies you are looking at, and may be able to tell you how readily and accurately they pay for services.

The time you spend investigating insurance companies and plans may be time well spent. It may help you get the best value for your premium dollars and ensure that you and your family have the right coverage.

You can read more about Donna’s second career, making world-famous mookies, at FincherFamilySweets.

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