Voices of Self-Reliance | Top 10 Questions to Ask When Selecting Health Insurance
It’s that time of year for the annual Open Enrollment for the Affordable Care Act (ACA), also known as Obamacare and/or the Marketplace, for Individual Health Insurance. Open enrollment lasts approximately six weeks but may be extended based upon the rules of your state.
While there is also an Open Enrollment for employer sponsored plans (aka Group Health Insurance) the dates and time frames may differ. This article is focused on Individual Health Insurance. We also do not address Medicare (for those ages 65+ or who qualify for Medicare Disability) or Medicaid (state-issued medical coverage for low-income individuals and families.).
There is a great deal of confusion regarding health insurance. What are your options? How do you know what is best for you? What are the questions you should ask to determine if one plan is better than another? There are so many different variables that each person must consider and there is simply no one-size-fits-all.
Following are a few questions you should ask when determining what plan is best for you:
#1. What are my choices?
- ACA Plan – Generally designed for long-term coverage. Health history has no bearing in one’s ability to qualify.
- Private Market Plan – For those who find the ACA plans are outside of their budget and/or those who are healthy, without pre-existing health conditions.
- Self-Funded Plan – Many refer to these as ‘faith-based’ plans but self-funded plans also include organized groups such as real estate agents and other such cooperatives. While viable, there is more risk associated with these types of plans, as they lack the same oversight and financial backing as ACA and Private Market Plans.
- Short-Term Plan – As their name implies, these are not designed for long-term coverage and generally do not cover pre-existing conditions. These are designed for those between jobs or between insurance coverages and only require interim coverage.
- Limited Benefit Plan – These are plans with specific benefits and established benefit amounts regardless of the cost of treatment.
#2. How much will it cost? Premium / Deductible / Co-Insurance
There are various fees associated with the total cost of your coverage. You need to consider all of them in order to calculate your bottomline / out-of-pocket cost. This calculation will be different for each person depending upon their health insurance utilization.
The calculation should not only include your premium (the monthly cost to have the plan), but also your deductible (your out-of-pocket dollar amount that you must meet before the majority of your benefits become available), your co-pay (the portion of your medical costs for which you are responsible after the deductible is met), and your out-of-pocket maximum (your annual out-of-pocket maximum for the benefits the plan provides).
#3. What if I’m Well / What if I’m Sick? What’s NOT Covered?
Do you have pre-existing conditions? If so, a ‘guaranteed issue’ plan (for which your health history has no bearing in your ability to qualify) such as the ACA may be your best choice. However, if you are healthy and haven’t any major pre-existing conditions, you may find a significant savings and stronger value proposition on the private market with an ‘underwritten plan’ (you must qualify based upon your health).
#4. What Are the Plan’s Restrictions on Pre-Existing Conditions?
Your plan benefits should provide adequate coverage for your specific health concerns. Ask hypothetical questions to be sure that those areas for which you have greatest concern are covered AND by how much. In other words…how much does the plan pay and how much do you have to pay/what is your financial exposure?
#5. What Type of Plan Is It?
- HMO – Health Maintenance Organization (choice of providers are often part of a statewide organization)
- EPO – Exclusive Provider Organization (choice of providers are generally confined to your county)
- PPO – Preferred Provider Organization (generally nationwide and allows the greatest amount of control with regard to your providers)
#6. Can I Get a Little Help?
What happens when you have questions regarding your coverage? Who will you call? Do you have any sort of advocate that is able to assist you? These questions are important, as there is nothing more frustrating than having to fight with your insurance company to process your claims and/or help you determine coverage in the time of need.
#7. Will I Be Able to Use My Current Doctors?
It all depends upon the type of network you have and who the doctors are in that network. See #5 for the types of plans, which will dictate your network and therefore choice of medical providers..
#8. Are Routine Examinations Covered?
Plans may include In-Patient Benefits i.e. hospitalization, in-patient surgery and the like, Out-Patient Benefits i.e. doctor appointments, prescription coverage, urgent care and the like, and Health & Wellness Benefits i.e. annual physical exam, pap smear, immunizations, amongst other benefits. Every plan is different and it is imperative that you understand what is covered and more importantly, what is NOT covered based upon your particular needs.
#9. Got Perks?
Supplemental Plans, as the term implies, supplement/complement your coverage. Supplemental plans include dental, vision, accident, telemedicine, critical illness, disability, and so on. Work with your insurance agent to understand the supplemental coverages offered to make sure you are covered in all the areas where you have the greatest concerns.
#10. What Happens When I’m Away from Home? International?
Make sure you know what, if anything, your insurance will cover when you are outside of the country. It is recommended that you consider a Medical Travel Insurance policy when you travel internationally.
#11. Is the Insurer Financially Stable?
Work with a reputable company, and for the greatest peace-of-mind, one that is backed by a reinsurer with governmental oversight. Also find out how quickly and efficiently claims are handled.
Health Insurance is a broad topic with lots of variables, nuance, and exceptions. Find a reputable agent who will prioritize YOUR needs, clearly explain the details of the plan(s) they recommend, and patiently answer all of your questions.
And at the end of the day, if you are one of the lucky ones that has found a good insurance agent, do your friends and family a favor and share your agent’s contact information with them. It can be difficult to find a good insurance agent and too often people enter their information online only to become overwhelmed with solicitation calls. If you need a recommendation, ask around and/or go online to find reviews for good agents.