How To Get The Insurance That’s Right For You
HMO, PPO, HSA. We’ve all heard these terms before but many people really don’t know the difference and why the difference is so important.
The health insurance industry is filled with confusing acronyms like these —we call it healthcare soup. The confusion around them makes it hard to understand what insurance plans really offer, but also they make it hard to determine which plan is right for you.
This guide is designed to clear up the confusion and give you the tools you need to make the insurance decision that’s right for you.
Choosing A Health insurance Plan—Start With A Health Risk Assessment
What’s a health risk assessment you ask? A health risk assessment is a tool that you should use before you make a decision on health insurance. It helps you understand your needs as a healthcare consumer, helps you identify your risks and helps you understand your costs.
It all starts with defining who you are because without that understanding, you won’t know what to buy. You could over-buy or under-buy insurance, and both of those are bad decisions.
This assessment has a standard set of questions that helps develop your health profile. It assesses your health status, estimates your level of health risk, and recommends ways to change your behavior to improve your health.
What Information a Health Risk Assessment Collects
Information collected includes your demographic information (age and sex), lifestyle information (alcohol intake, exercise habits, whether or not you smoke, etc.), personal and family medical his- tory, physiological data (weight, height, blood pressure, etc.), and your attitudes and willingness to change your behavior in order to improve your health.
The HRA analyzes this information to produce a health risk profile, which ranks your health in seven key health areas: heart, cancer, diabetes, obesity, nutrition, fitness, and mental and emotional health through color-coding, graphs, icons, and a number based scoring system that tells you if you are doing well, need to be cautious, or need to take immediate action. It recommends key ways to improve your scores and health.
How to Take A Health Risk Assessment
How can you get your own health risk profile? About 33 percent of employers offer these HRAs (Health Risk Assessments) through their employee health plan. If your employer is one who gives you access to an HRA they will direct you on where and how to take it.
If your employer doesn’t offer a HRA, that doesn’t mean you’re out of luck. There are other online resources where you can access one.
What’s Next? Compile Your Health Record
After completing an HRA, you need to compile all your medical history to complete your total health profile. At first, it feels like a lot of busy work, not a joyous experience, but it’s worth it. Use the checklist below to make sure you have everything you need
Health Record Checklist
- Documentation of conditions you have been diagnosed with
- Biometric data
- Copies of your past physicals
- Immunization records
- Records of surgeries you’ve had
- Past X-Rays, MRI’s, CT scans or other imaging you’ve had
- Diagnostic test results
- Your current medications
- Family history of genetic conditions
It’s a big list, but your health record will be much easier to maintain and update once you do it. If you can’t manage to collect everything or don’t have the time, something is always better than nothing. In that case what’s most important is to have documentation of your current conditions, medications, surgeries and family history.
Now You’re Ready To Make The Right Decision
These records complete your in-depth health profile. Having full access to your records, electronically or via hard copy, will help you communicate effectively with your doctor in an efficient manner. That way, they can more accurately assess your conditions and prescribe effective courses of treatment. These records also set you up to find a health insurance option that’s right for you and select a doctor who best fits your needs.
Making The Right Insurance Decision
What Insurance Has To Cover
What does insurance have to cover? The Affordable Care Act (ACA), aka Obamacare, man- dated all individual or employer-sponsored health plans must cover these ten essential benefits without annual or lifetime spending caps. Note: annual deductibles, copays, and out-of-pocket requirements must still be met, but once met, the medical expense cannot be limited.
- Ambulatory patient services (outpatient care without being admitted to the hospital)
- Emergency services
- Hospitalization(such as surgery and over night stays)
- Pregnancy, maternity, and new born care (both before
- and after birth)
- Mental health and substance abuse disorder services
- including behavioral health treatment
- Prescription drugs
- Rehabilitation and habilitative services (those that
- help patients acquire, maintain, or improve skills necessary for daily functioning) and devices
- Laboratory services
- Preventive and wellness services and chronic disease management
- Pediatric services, including oral and vision
Make Sure Your Plan Has Access To The Providers You Need
Different types of plans (HMO, PPO) and different insurance carriers (Blue Cross Blue Shield, Aetna, Cigna, United Healthcare, etc.) repre- sent different providers. Some plans have more doctors and hospitals available and others fewer. Some may be limited by geographic areas.
You can find this information using your insurer’s provider directory. Below is a list of the major insurance carrier’s provider directories. However, you will need to log in to view the directory.
HSA vs. PPO vs. HMO – General Strategies To Choose Between Plans
Everything you’ve done up until this point is critical because it’s what allows you to make sure your insurance decision is right for your personal needs. However, there are some general strategies that you should have in mind when it comes to choosing between HSA’s, PPO’s, and HMO’s.
When To Choose A PPO
|If you’re a family who uses the healthcare system but doesn’t have a ton of claims||A PPO will provide you with the right amount of coverage, but you shouldn’t get to a point where you’re paying more than you would with another plan type.|
|If your personal cash flow isn’t great||Your monthly premium will be slightly higher but co-pays will make prescriptions and trips to the doctor more affordable in the short term.|
PPO’s have become the most common type of plan offered and almost every employer will offer a PPO plan. PPOs grant you the freedom of choice to see any provider but create a network of physicians and hospitals (“in-network”) that offer discounted pricing to plan members. The networks are generally broad but do not include all providers.
It’s really important to have an idea of how much you will use the healthcare system during the year. A PPO can be a great general solution, but if you start to rack up claims, an HSA can be cheaper in the long run because the plan will pay 100% after you’ve met the deductible.
When To Choose A High Deductible Plan With An HSA
|If you’re young and healthy||
You should be using the healthcare system rarely so an HSA will offer the cheapest monthly premiums and provide protection against any catastrophic health condition.
|If you have a chronic condition or are battling a serious illness||
An HSA will be more effective than an alternative plan in the long run because you are essentially hacking the system to have your plan pay 100% of your health costs once your deductible is met. If you anticipate easily exceeding your deductible during the year you will actually end up saving money vs. a co-pay plan.
If you don’t have enough cash up front to meet your deductible, set up payment plans with your providers to take the weight off financially.
A High-Deductible Health Plan follows all the features of a basic PPO with one exception: it cannot offer any copays for any level of service. The plans do not pay until deductibles are met; that includes physician office visits and prescription drugs (see example plan). Deductibles must be at least $1,350 for an individual and $2,700 for a family.
When To Choose An HMO
|If you have minor health needs, your current doctors are in-network and you don’t expect your health to change||
An HMO will provide the cheapest protection to you if you’re a moderate user of healthcare and you don’t expect to need care from a provider out of network.
HMOs offer a contracted network of physicians and medical providers that you may choose. There is no coverage for non-networked providers (except in emergencies).
The major drawback of an HMO is the lack of choice. Before selecting an HMO as your health plan you need to make sure that you are satisfied with the doctors, pharmacies and hospitals that are in network because you will be locked in to those providers.
Another thing to consider before selecting an HMO is whether or not you anticipate that your health situation will change. If you suddenly have a new need arise in the middle of the year, an HMO might not be the best plan option.
Using Alternative Health Insurance Options To Cover Gaps
Any health insurance plan can have gaps when it comes to what it protects. This can be true for all health plans but is especially true for high deductible plans with an HSA. In those situations you have options when it comes to closing the gaps.
- Critical illness plans
- Accident plans
- Christian coverage
- Credit cards
Finding The Plan That’s Right For You
The most important thing to keep in mind when you’re shopping for health insurance is to make sure the plan fits your needs.