A Matter of Insurance

DOWNTOWN LOS ANGELES - Picking the right health insurance plan is confusing. What should you look for? And where do you begin?

Paying for insurance can be a gamble. If you are fortunate enough never to have had serious health issues, you may find yourself grumbling over “wasted money.” However, if a serious health issue arises and you need intensive medical treatment and hospitalization, you will wish you had insurance. Sadly, there is no way to know about an unexpected illness, and sometimes when you realize you need the coverage, you may find that your pre-existing condition cannot be covered.

If you are lucky, you have a decent health insurance plan through your place of employment. The homework — most of it, at least — has been done for you already, and you have some choice, although it may limited.

Unfortunately, that is not the case for a growing number of Americans. Many do not have positions that include insurance. Often, the insurance that is provided cannot meet the needs of a growing family. There are also young graduates who no longer qualify on their parents’ insurance plans but have not found jobs that include benefits. With the high unemployment rate, more Americans have lost or are losing their employer-provided benefits as well.

While changes are coming due to federal healthcare changes, many will not be implemented for years.

Today, the majority of Americans who are insured are enrolled in managed care plans. Managed care was designed to keep medical costs and insurance payments lower; patients often require pre-certification and medical care within a network. Health maintenance organization, or HMO, plans generally allow for little decision-making on the part of the patient and medical provider and are often the least expensive options. Traditional indemnity plans allow a patient and doctor the most freedom in treatment decision-making. In between are point of service, or POS, plans and preferred provider organization, or PPO, plans.

Whether you have a choice to make or are shopping for a plan for which you will self-pay, Kate Prout of the Aetna communications department offers the following suggestion.

“Review the ‘four C’s,” she says. “Changes to current plan options; cost of premiums, deductibles, copayments and coinsurance; coverage information, such as whether your doctor is still in the insurer’s network; and choices of benefits. Find out what kinds of options are available.”

Premiums are what you pay periodically for the insurance plan; the deductible is what you pay out of pocket before the insurance plan pays anything; copays are your portion of the bills; and coinsurance is the amount of coverage that you and your insurance company share responsibility for.

Prout suggests making a list of your benefit priorities based on what your health (and if you are not single, your family’s health) has been like over the past year or so. If you have a chronic condition and require regular prescriptions, you might want to verify that both services for your ailment and a pharmacy plan are included. Verify that the doctor who has been treating you and any necessary specialists are included in the network of providers.

Most employer-insured participants who lose coverage are entitled to pay for temporary insurance under COBRA. The plan mirrors the previous insurance, but the employer no longer pays into it, so the cost may seem exorbitant, though it is still generally less than a self-paid individual plan. Many states offer reasonably priced (for the market) options to insure children, self-employed people and small businesses in special situations.

If you are considering changing health plans, be sure to do a side-by-side comparison of benefits. Also, note additional benefits, such as dental and vision. Assess what your previous insurance usage has been to make sure that any differences would meet your needs. Allow for anticipated lifestyle changes, such as marriage and children. Be aware that generally, the higher your deductible, the lower your premium and vice versa.

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page 16, 04/12/2010

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