How to Choose a Health Insurance Plan

The health insurance marketplace is vast and it can be easy for consumers to feel overwhelmed by the sheer number of choices they face.

Fortunately, common lifestyle, personal preference and health status questions can help consumers narrow down their options. Deciding whether or not they are comfortable with designated primary care providers, for example, can help potential buyers eliminate a number of options right away. Determining the frequency with which an individual or household expects to need care while traveling outside of their plans’ network range can similarly reduce the number of appropriate options.

However, sometimes after completing those initial rounds of easy eliminations and determining which type of health insurance plan, potential enrollees still find themselves struggling to decide between seemingly similar policies. When that happens, it is tempting to just select the least expensive plan and move on. Unfortunately, that can result in households paying much more for care over the long run, or it can result in consumers sacrificing their quality of care due to inconveniences and headaches down the line. Understanding which additional questions to ask can help buyers make the best decisions without unnecessary delays or stress.

Start With What is Already in Place

Federally funded research consistently shows that strong patient-provider relationships improve health outcomes. Patients with providers they like and trust are more likely to comply with treatment plans, take chances on recommended treatments they are not familiar with and trust their providers’ advice. The more providers get to know their patients, the better they can tailor their support and suggestions to patient needs.

With this in mind, nearly all health insurance and health care professionals strongly recommend that consumers enroll in health plans that allow them to keep their existing providers if at all possible. In most cases, consumers should start with their primary care providers. Those who do not have primary care providers (PCP) should evaluate any specialist providers they see and give priority to signing up for plans that allow them to continue to see those providers. They may want to also intentionally select plans that do not insert a PCP between them and their existing specialty providers. For example, preferred provider organization (PPO) and exclusive provider (EPO) health insurance plans allow patients to self-refer to the specialists of their choice, which creates no barriers to existing patient-provider relationships.

Explore the Networks

Consumers who have no existing patient-provider relationships or for whom those relationships do not impact their choices should evaluate the networks of the plans they are considering. Potential enrollees should look at:

  • The number of providers affiliated with the plan.
  • The types, diversity and availability of in-network providers.
  • Where in-network providers are located geographically.
  • How many in-network providers the consumers are familiar with.
  • Any quality and patient satisfaction ratings available for in-network providers.

Some types of plans will naturally have smaller networks than other kinds of plans. But plan size is only one aspect of network quality that consumers need to consider. For example, each enrollee only needs one PCP but may wish to access a wide range of specialist providers. If 70 percent of a plan’s network is comprised of primary care providers, then it is likely the PCP the consumer wants will be available, but it is equally likely that their choice of specialists will be slim.

Enrollees with specific conditions, such as diabetes, can benefit from listing the types of specialty providers they expect to need to see in the next year (e.g. dieticians and podiatrists) and looking up the plan’s in-network offerings in those categories. This will give them a strong idea of how satisfactory their options will be when they need to access that care.

Potential buyers should also make a point of examining where in-network providers are located in relation to their homes and workplaces. For instance, buyers on the far edge of a network’s geographic range will continually need to travel longer distances to access care compared to patients in the heart of a network’s range. This may not be a deal breaker but it can strongly impact the quality and convenience of care.

Finally, potential enrollees should look at the quality of the providers in a plan’s network. They can do this by looking for providers they recognize or have experience with. A few quick searches of a selective sampling of other providers listed can give patients an idea of the general levels of satisfaction other patients have had with in-network providers. Do any of them have regional or national awards for quality? Do they advertise compliance with nationally recognized best practices? Do they garner positive patient reviews? On the opposite side of the spectrum, have any of the plan’s providers been cited by regulatory authorities for inspection or quality violations? This type of research does not take very long to do but it can provide consumers with invaluable information.

Look at Cash Flow

Consumers who find themselves torn between plans of similar quality and network size may find the answer to selecting the best plan for their needs lies in investigating the financial benefits and downsides of each plan. In addition to determining the health insurance costs such as premiums, copayments and deductibles, potential enrollees can ask themselves the following questions to get started:

  • What costs are not covered by these plans? (E.g. prescription medications and out-of-network care)
  • Are there limitations or restrictions on what qualifies as emergency care? (E.g. Is emergency care restricted to serious injuries like broken bones or does it also cover smaller traumas like bee stings?)
  • What costs count towards those deductibles?
  • How long does it usually take for the plan to process out-of-network claims and reimburse them?

Buyers who have little savings and who cannot afford to pay out the full amount of money required to meet high deductibles on plans, like those for health maintenance organization policies, are often better off paying slightly higher monthly premiums for low or no deductible plans. Likewise, enrollees who need multiple prescription medications may do better with plans that charge higher premiums but lower copays per refill.

By contrast, buyers who have enough savings or income cushion to pay their full deductible on short notice in the event they are seriously injured may stand to save money by selecting a higher-deductible, lower-premium plan.

Consumers should also examine whether any of the plans they are considering will qualify them for a health savings account (HSA). The tax benefits of an HSA may counter-balance the risks of a higher deductible, particularly for patients who are generally in good health.

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