How to Pick A Health Insurance Plan

New job? Congratulations! Ask these 6 questions before you choose your health insurance.

Ready. Set. Go pick your plan!
Photograph: Photo by Scott Little

1.   HMO vs. PPO? The main difference between an HMO (Health Maintenance Organization) and a PPO (Preferred Provider Organization) is where you receive treatment. An HMO will dictate what hospitals and doctors you visit, while a PPO will let you go out of network (enabling you to chose any doctor you’d like.) If you’re looking at a PPO, be sure to find out what the charge is for using someone off the insurer’s preferred list. If you’re switching jobs and you like your current gynecologist, an HMO might not be the right choice for you.
2.    Is your new company self-insured? A large business or corporation is mostly likely self-insured, meaning they cherry pick their own benefits. Smaller companies deal with outside insurance agencies such as Blue Cross Blue Shield or Aetna and are mandated to provide all the benefits provided by the state. If your company is not self-insured, you’ll likely deal with the owner, not an HR rep, to discuss options, explains Kansas Insurance Commissioner Sandy Praeger. If that’s the case be sure to get an understanding of what your state says you legally receive (such as mammograms and PAP smears).
3.    Included vs. excluded? “Don’t forget to thoroughly read the ‘limitations and exclusions’ section of the health plan,” says Steve Trattner, CMO of Cinergy Health. Consider your family history and your plans for the future. Are there limitations surrounding tests for a disease that runs in your family? Does the plan cover labor and delivery? In the future you might feel you need a test or procedure that’s not covered by the plan–is there an appeals process in place for you to challenge the decision? More’s associate health editor, Denise Maher, suggests finding out if the plan covers cutting-edge tests such as those that detect mutations in the BRCA genes (flaws can indicate a predisposition to breast and ovarian cancers).
4.    Does the plan offer a drug component? If there’s a list of preferred drugs, what is the co-pay if you need a drug not listed? “Understanding the rules around drug coverage is very important,” says Praeger. “What will you pay if you want a brand name drug that you know works well for you?”
5.    How does the plan handle pre-existing conditions? When you’re entering into a new plan with a pre-existing health problem, things can get more complicated. The industry standard is to withhold coverage for treatment related to the problem for 12 months, explains Trattner. Look for any complicated terms or conditions that could extend that period. Some plans include clauses saying that if within that 12 months the patient receives outside care for the condition, the wait time could double.
6.    Which option is accepted by more doctors in my area? If your job offers different insurers (such as options from both Aetna and Coventry), call each individually to find out which has more providers in your area. “It’s important to know you’ll have the support you need when you need it most,” says Trattner. Dial each company’s customer service departments at similar times during the week and note which one was helpful and answered quickly—and all else being equal, pick that one, not the one that kept you on hold for 45 minutes!

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