Choosing the right health insurance plan from the exchange
Gone are the days of worrying about not having your pre-existing condition covered by your new insurance company. New considerations have arisen from the health insurance exchange created by the Affordable Care Act. For those not covered under an employer group plan choosing a new plan is now an annual occurrence under what is know as Open Enrollment. This year open enrollment opens November 1, 2015 and closes January 31, 2016.
Things to Consider:
-Monthly Premium
-Federal Subsidy
-Provider Network
-Out-Of-Pocket Costs
-Quality of Health Care
Monthly Premium
Monthly premium is perhaps the most intriguing and most weighted consideration when one shops for a new health plan. To shop and compare the premiums there is about a five-minute question and answer process that you can participate in on the exchange. To find your exchange visit www.healthcare.gov.
There are five levels of plans: platinum, gold, silver, bronze, and catastrophic. Each level meets a different set of actuarial guidelines set forth by the federal government. In general, platinum has the highest premiums with catastrophic being the least expensive.
Be careful not to choose your plan by premium alone, as there are other considerations to take into mind. You should consider total out-of-pocket costs and quality of care along with the premium.
Federal Subsidy
In relation to the Monthly Premium is the federal subsidy. An individual or family can effectively have their Monthly Premium reduced dollar for dollar by the Federal Subsidy.
Individuals and families are eligible to receive premium tax credits based on the size of their family and their annual income either through monthly reduction of their health plan or a tax credit upon filing their annual federal income tax return. The healthcare.gov website has some online calculators provided that you may use to check on the amount of your federal subsidy.
More information regarding the federal subsidy can be found at the IRS website: https://www.irs.gov/Affordable-Care-Act/Individuals-and-Families/Questions-and-Answers-on-the-Premium-Tax-Credit
Provider Network
Those who have epilepsy usually have a close relationship with their doctor/provider so it is vital that you consider the HMO, POS, or PPO network when evaluating health insurance plans on the exchange. HMO’s – Health Maintenance Organizations are typically more stringent on which providers you can see as the patient. PPO’s – Preferred Provider Organizations on the other hand give the patient more freedom on which providers one can choose.
The healthcare.gov website does a reasonably good job of allowing the consumer to compare the Provider Networks. To peel the onion back even further on the Provider Network I would recommend one to visit the actual insurance companies’ websites and become familiar with the particular network by name before signing up for coverage.
Also, doctors fall in and out of network all the time. It would be wise to confirm with both your doctors office and the insurance company that they plan on staying together for the time period of coverage you choose.
Out-of-Pocket Costs
The Out-of-Pocket costs are the maximum liability an individual or family is responsible for on the year. This liability is probably one of the least understood, yet most important factors in insurance plans. It is extremely important for those with chronic disease understand what their maximum Out-of-Pocket costs are going to be.
The Out-of-Pocket includes copays, coinsurance, deductibles, and prescription costs. Once you meet your entire Out-of-Pocket liability for the year, then the insurance company covers the remaining claims at 100%.
If you are a heavy user of the insurance then I would recommend that you add the annual premium and the annual Out-of-Pocket together to come up with a good comparison on what your annual medical costs are going to be. This formula will then help you compare different plans.
Quality of Care
“If you have substandard care … through your health plan, paying any amount of money is not a good trade-off,” says Beth Abbott, director of the state Office of the Patient Advocate (OPA). “People should consider the interaction of both cost and quality.”
It would be wise to check with each insurance company and find out ahead of time if they have any special utilization programs for chronic diseases such as Epilepsy. Seizure medications must be covered appropriately in order for the particular health plan you are considering being viable. Often, the best way to do this is to call the company directly instead of trusting ahead of time the words you read on the internet or the words of an insurance agent or broker. I advise to check on the policies of covering both Brand and Generic drugs and whether or not you have a choice on the particular medication that works for you.
On the healthcare.gov website you may click on a health plan’s name, you can inspect customer service options and hours, which can be critical if you’re dealing with a sick child in the middle of the night and need advice. Some are open 24/7, including weekends. Others only answer the phone from 8 a.m. to 5 p.m. on weekdays.
In conclusion, each year when choosing a new health plan it is good to go in with your eyes-wide-open and evaluate more than just the new insurance company’s name or monthly premium. In all likelihood you are going to be stuck with the health plan you choose for the next 12 months of your life – it pays to do a little research instead of making a major mistake.
Zack Zettergren, CFP®
