By LESLEY ALDERMAN
Published: February 2, 2009
With Americans spending an ever increasing amount on medical costs, it’s more important than ever to have insurance that fits your health care needs. So when you start shopping for a plan, don’t just look for one with the lowest premiums. Consider the services that are most important to you.
Your Money Guides
Health Insurance »
Patient Money Columns
Advice on handling the consumer pocketbook issues of health care.
Go to Patient Money »
The best place to get health insurance, of course, is from your employer. Group plans are typically cheaper, and your employer will probably cover much of the cost.
There are three main types of coverage you can choose from: H.M.O.s (health maintenance organizations), P.P.O.s (preferred provider organizations) and the newer option called an H.D.H.P. (high deductible health plan) paired with a savings account. A small number of companies still offer old-fashioned, fee-for-service plans, but their ranks are dwindling.
Here’s what you need to know about the most common plans:
H.M.O.S provide comprehensive coverage at a low cost to the consumer. In general, you don’t pay any deductibles or co-payments for basic care (and if you do, they will be relatively low). But your choices will be limited. You can generally use only the doctors and hospitals within the H.M.O.’s network, though more plans are easing up on this restriction, and your designated primary-care physician will determine the level of care you require and when you need to see a specialist.
Pros: Low cost. Coordinated care.
Cons: A limited choice of providers. If you go out of network, for example to a specialist, you will probably not be reimbursed.
PREFERRED PROVIDER ORGANIZATION AND POINT OF SERVICE plans were created in response to consumer frustrations with the limitations of H.M.O.s. You can choose to go to network providers and pay a small co-payment, or go out of network and have only a portion — typically around 60 to 70 percent — of your costs reimbursed. The main difference between the two is that a point of service plan requires a referral from your primary care physician to see a specialist, while the preferred provider plan does not.
Pros: More flexibility than an H.M.O.; lower overall out-of-pocket costs than a fee for service plan.
Cons: It’s tricky to predict your costs unless you’re willing to stay within the network. Getting reimbursed for out-of-network claims can be a hassle.
HIGH-DEDUCTIBLE HEALTH PLAN Over the past few years, more employers have begun to offer the option to sign up for a high deductible health plan that is linked to a health savings account or health reimbursement account. Some employers may offer the high-deductible health plan on its own and allow the employees to set up a savings account with the bank of their choice.
The plans work like the preferred provider option, but the deductible is much higher — at least $1,150 for coverage of a single person and $2,300 for families. To compensate for the larger deductible, employers typically offer different two savings options:
- A health savings account allows you to put away pretax dollars and then withdraw the money to pay your out-of-pocket costs. (Your employer may kick in some money, too.) In 2009, you and your employer can put up to a combined limit of $5,950 in a health savings account if you opt for family coverage ($3,000 for singles). The money rolls over from year to year, so you can basically store up a medical emergency fund. When you’re 65, you can take the remaining money out without paying a penalty, though you’ll pay taxes on the withdrawal if you’re not using it to pay for medical costs.
- A health reimbursement account is financed solely by your employer. Typically, an employer will contribute an amount equal to about half the employee’s deductible The money rolls over from year to year, but you cannot take the money with you when you leave the company.
Pros: Low premiums. Tax-free savings (in the case of the health savings account).
Cons: Potentially high costs, especially if you or a family member becomes chronically ill. Don’t choose this option unless you have the money to pay the deductible.
INDEMNITY, OR FEE-FOR-SERVICE, PLANS are offered by fewer and fewer employers because of their expense. They allow you to go to any doctor, hospital or medical provider you choose. The plan typically reimburses 80 percent of your out-of-pocket costs after you fulfill an annual deductible.
Pros: Flexibility. You can go to any medical provider, anywhere, without seeking plan approval first.
Cons: Your total out-of-pocket costs will probably be higher than in a preferred provider plan or H.M.O. Most fee-for-service plans don’t cover preventive care like flu shots or mental health services.
To help narrow your choice, here are the steps you should take:
1. Ask your favorite doctors which insurance plans they accept. If you find that one or more of your doctors do not accept any insurance plans, then you’ll want to select a plan that reimburses you for your costs when you go out of the network.
2. Make a list of all the services you and your family use. Include on the list things like vision care, dental, physical therapy, acupuncture and mental health care. Find out how the plans you like best will cover these services and at what cost.
3. Compare costs. Write down the costs associated with each plan, including premiums, out-of-network costs, and extras like vision or mental health care.
The Joint Commission on the Accreditation of Healthcare Organizations has put together a comprehensive list of helpful questions.
In addition to offering low-cost health insurance, your employer may also offer a health care flexible spending account, which lets you set aside pretax dollars to pay for your out-of-pocket medical costs. (If you have already signed up for a health savings account, you can only use the flexible spending account for dental, vision or post-deductible medical expenses.) You can deposit up to $5,000 a year in a flexible spending account, depending on the limit set by your employer. The money will be deducted from your paycheck and you can’t change the amount midyear. If you have high medical costs, using a flexible spending account can save you hundreds of dollars a year in taxes. But calculate your costs carefully. The money does not roll over to the next year. Any money you don’t use will be lost.
If you need to buy insurance on your own — there are a number of options to consider, including these:
First, if you are about to lose your job and work for a company with more than 20 employees, you can remain on your employer’s plan for up to 18 months, under a federal law called Cobra, the Consolidated Omnibus Budget Reconciliation Act. But you will have to pay the full premium plus 2 percent for administrative costs, and the expense is often quite high. This may be a good temporary measure, though, until you can find a more affordable option.
If you’re out on your own, try to find a group plan to join since group plans typically cost less and offer more benefits than individual plans. Can you join your spouse’s plan? Do you belong to (or can you join) a union, professional organization or alumni group that offers insurance? You may also be able to find a group plan for freelance workers. If you are over age 50, look at the plans offered by the AARP.
If a group plan is not an option for you, you’ll have to buy an independent policy. Fortunately, there are numerous plans to consider. The simplest way to compare policies and prices is by going to an online insurance broker like eHealthInsurance.com. At EHealthInsurance, for instance, you simply fill in your gender, ZIP code and date of birth -- and, if you want, the names of your doctors — and the site comes up with a list of policies for you to consider. You can apply online.
If the prospect of sorting and sifting through dozens of policies seems daunting, consider using an independent insurance agent, who sells many different kinds of health insurance. You can find agents in your area at the Web site for the Independent Insurance Agents & Brokers of America.
Individuals with modest incomes may be eligible for Medicaid. You may be able to get coverage for your children through the State Children’s Health Insurance Program, a federal-state partnership.
If you have a serious health problem and are unable to find coverage through a private insurer, find out whether your state has a high-risk pool that you can join. While these plans are not low in cost, they are often the only option for people with pre-existing conditions.
http://www.nytimes.com/2009/02/03/your-money/health-insurance/primerhealth.html?em=&pagewanted=all
No comments:
Post a Comment