Deductible. Co-pay. Flexible spending account. Co-insurance.
If these words sound like a foreign language to you, you’re not alone. The jargon of health insurance is confusing, but when open enrollment season kicks off this month it’s especially critical that you’re prepared to select your coverage. Craig Rosenberg, Aon Hewitt’s national leader for Health & Welfare Benefits Administration, says it’s the one time of year when employees can see if what they’re paying for is what they need.
You see, insurance can’t necessarily be changed whenever you realize you need different coverage or want to pay a different price. There are certain events — called life events — that can happen during the year and would allow you make a change. Life events include things like getting married or divorced, having children, leaving prison, or losing existing coverage. But if your situation doesn’t fall under the life event umbrella, you’re stuck with what you’ve got until open enrollment rolls around in the fall.
“Even before open enrollment starts, so right now, it’s a great time to take a step back and really assess your situation and your family’s situation,” Rosenberg says. “So think about your health care needs: maybe you’re thinking about having a child next year or maybe not, but that’s a way to prepare for being an active participant in open enrollment.”
The good news? Now’s the time you can take full control over your plan selection. The bad? Insurance is pretty confusing and there may be a steep learning curve. So, we’re breaking down some key considerations you should make before picking a plan:
1. Do your homework
Open enrollment isn’t just a time to upgrade your plan. Rosenberg says it’s also common for plans to change themselves. Besides assessing any changing personal health needs, find out what your plan is currently offering and how it might have changed from last year. “Your needs in 2016 might not be your needs in 2017,” he says. Take advantage of online and printed materials on insurance plans that should be available through your employer. Also, Rosenberg notes there’s almost always a list or summary of what’s changing and what new options are available. Most plans also offer online decision tools that will show side by side comparisons of various plans, which is when you can start to…
2. Think about cost
“There’s a tendency to look at the price of the plan and say: what is the cost for me to purchase that coverage?” Rosenberg says. But that’s only half the equation. You also have to make sure you understand what it will cost to use that plan once you’re enrolled. “The plan that costs the most to buy may not provide the best coverage for your needs, and the inverse is true as well,” he says, which is why it’s extra important to…
3. Learn the language
Many health care plans have a deductible, which is an out of pocket expense that you need to cover before the plan coverage actually kicks in. Rosenberg advises that once you know what the deductible is, also find out if your plan has a co-pay or co-insurance. A co-pay might be a $30 or another flat amount you pay per visit, but co-insurance works differently, and requires you to pay a certain percentage of the cost for any doctor’s visit. It’s important to know the difference between the two, and while your employer might offer a glossary of sorts, do your own research to make sure you understand exactly what is being offered.
There are also other variables to keep in mind, like flexible spending accounts (FSAs), which allow you to put a certain amount of pre-tax dollars away to use on various, qualified medical expenses. Every plan differs in what these dollars can pay for, but examples include acupuncture, glasses, contacts, over-the-counter medication, and so on. But FSAs can get tricky, Rosenberg says, since the money you put into the account cannot be rolled over to the next year if you don’t spend it all.
Once you know what you’re actually signing up for, it’s time to…
4. Check with your doctors
One of the most important steps to take before selecting a plan is to verify that your current doctors will be covered, whether you’re selecting a new plan or not. “If you have an OB/GYN you’re seeing, even if they’re in the plan for 2016, there could be changes and they may not be in the plan for 2017,” Rosenberg says. Most employers will give you a way to check to see which providers accept each plan through the health plan’s website. By that time, all that’s left to do is…
5. Ensure your reproductive system is covered, too
Thanks to the Affordable Care Act, it is legally required for various reproductive healthcare services to be covered by most insurance plans at no charge to the insured. That means no co-pay or co-insurance charge for an annual well-woman gynecologist visit, prescription birth control, testing for HPV and HIV, counseling for other STIs, and screening and counseling for domestic violence. In addition, pregnant women are entitled to receive free screenings for gestational diabetes and breastfeeding counseling.
“But when you go beyond that to things like fertility treatments, it’s important to know what the plans cover and what they don’t,” Rosenberg says. “That’s where some information that’s provided is so important, so you make sure you understand what you’re getting.”
Rosenberg’s number one rule besides doing your own research? Ask all the questions you need to. “It’s easy to say i’m just going to stick with what I have and I’m not going to make any changes,” he says. But it’s not easy to realize you don’t have the coverage you need.