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Choosing the Right Plan

One of the most serious decisions that you may have to make in your life is choosing the best health insurance plan for your family. There are important questions to ask yourself before you begin your quest for medical insurance.

Step 1: Evaluate Your Needs

The following list will give you a basic idea of where to start, and might encourage questions that are specific to the individual needs of your family, and their health.

• How many people are going to be covered?
• What are their ages, health conditions, gender, and long-term concerns?
• What requirements do you have when choosing a physician, hospital, clinic, dentist, chiropractor, and so on?
• Are your current providers listed with the possible insurance companies?
• Are there qualified and recommended providers in your area, or will you have to travel to another town or city?
• How much can you afford to pay for prescriptions, premiums, office visits, deductibles, and other "pop-up fees"?
• Are there "out-of-pocket" fees you will need to pay?

With these ideas in mind, the next step is to compare the different types of health insurance plans, and then determine which type will fit the needs of your family in the most comfortable way.

Step 2: Learn About Health Insurance Plans

Health Maintenance Organizations (HMOs)

This is a type of plan which groups all of its service providers together, at a fixed price per service. It is a good system for people who don't expect to need specialized care, only regular physicals, and minor illness treatment.

Indemnity of Fee-For-Service Plans

These health insurance plans are a bit more expensive, but they offer the most versatility, and convenience, as they allow you to choose your own health care provider, anywhere you happen to be. This is a great choice for people who do a lot of traveling.

Preferred Provider Organizations (PPOs)

These types of plans are basically a combination of the other plans, which is great for families with children, and also for the elderly who may need more medical care, more often.

Health Savings Account

A High Deductible Health Plan (HDHP) with a Health Savings Account (HSA) or a Health Reimbursement Arrangement (HRA) provides traditional medical coverage and a tax-free way to help you build savings for future medical expenses. The HDHP/HSA or HRA gives you greater flexibility and discretion over how you use your health care benefits.

Limited Medical Plans

Limited medical plans (also called "mini-meds"), are designed to meet day-to-day medical employee expenses for items such as wellness visits and prenatal check-ups. They are not meant to be substitutions for major medical plans, but they fill a need for new college graduates and others who may find themselves without health coverage for a time.

Step 3: Comparison Shop

Once you've determined what your family's health insurance needs, and perhaps the type of plan that best suits those needs, you should compare rates and services. It's also a good idea to research the health insurance companies you're reviewing and make sure they're solvent.

Understanding the Health Coverage You Have

Health insurance coverage is only effective when you understand the benefits and the limitations of the program. It's always best to find out up front what the rules are for your coverage so you can avoid any misunderstandings. What you learn can help you get the health care you and your family need and avoid unnecessary denials or delays.

The best way to become familiar with your health insurance is to start by reading your evidence of coverage term. This is the official document that describes all the details of the benefits, rules, and definitions of your coverage. (It may also be called a "certificate of insurance" or "summary plan description.") You should get the evidence of coverage when you initially sign up. It's wise to keep it in your files so it's readily accessible.

Here are the most important things to learn about your coverage:

• What's covered?
  • The heart of an insurance plan is its benefits. Get to know your benefits so you have a good understanding of the limitations of your coverage. It's wise to also spend some time understanding more about your prescription drug coverage.
  • No plan covers everything. Read the evidence of coverage carefully for exclusions and exceptions, as these are the services explicitly not covered. Dental care, hearing aids, eyeglasses, cosmetic surgery, infertility treatments, obesity treatments, and acupuncture are typical examples. Also consider that "pre-existing conditions" may also be excluded from coverage.
• How much is covered? Many plans have upper limits on what they will pay over your lifetime. If you have a serious, chronic, long-term illness, it is especially important to understand a plan's lifetime limits.
• Where can I get my care? Many plans require you to choose a primary care physician (PCP) term from a list. If you don't, they may assign you one. The PCP is the doctor that manages your overall care, the "gatekeeper," and is usually the one you go to first with a problem. Plans also may only reimburse certain providers, called their "network." Make sure you understand what doctors, hospitals and other providers are in the plan's network.

Should you continue to have questions about your specific coverage, review your insurance plan's web site or contact a customer service representative. If your coverage was acquired through your employment, ask your human resources office for assistance, or contact your insurance agent (if you bought your plan through an agent).