Short Wave - How To Choose A Health Insurance Plan

Episode Date: November 24, 2021

Health insurance can be tremendously confusing, with its complexity, jargon and acronyms. But putting in a bit of time to learn what these health insurance terms mean can empower you to better understand what signing on to a plan might mean for your budget and your health.Whether you're picking a plan for the first time, thinking of changing a plan, or want to see your options, NPR health correspondent, Selena Simmons-Duffin offers tips for browsing and choosing a health insurance plan. This episode is brought to Short Wave in conjunction with our colleagues at Life Kit.What other tips and tricks would you like from Short Wave? E-mail us at [e-mail]. See pcm.adswizz.com for information about our collection and use of personal data for sponsorship and to manage your podcast sponsorship preferences.NPR Privacy Policy

You're listening to Shortwave from NPR. Hey, shortwavers. I'm here today with NPR health policy correspondence, Lena Simmons-Duffin. We're going to talk to you about drummer-roll health insurance. Wait, don't go. I don't know about this. Stay with me. When open enrollment for health insurance rolls around, you know, usually in the fall,

HR departments and local brokers try to make it fun with, like, balloons and kazzoos. But you and enrollment, everyone, so exciting. But you and I both know that real talk, picking health insurance is important, but it's work. It takes research. It's also not fun or sexy to be talking about insurance or health care. There we go, right? Yeah, exactly. And there are a lot of confusing terms.

So once you hit your deductible amount, any subsequent service you receive after that, you would only be responsible for a co-payment or co-payment. insurance until you meet your maximum amount. Yeah, I need a dictionary for a lot of that. Right. But as folks gather for Thanksgiving, it might be a good time to talk about health insurance. So this year, the Affordable Care Act marketplaces run through January 15th. You got a little time. Okay.

So maybe enroll over the holidays or just talk with your family and friends about what your options are. Yeah. Selena, you make a good point. And we want to help because health insurance is really important. Health care is expensive in the U.S. Even getting an MRI can cost, what, like more than $1,000? Yep.

So health insurance offers financial protection, including covering preventive services for free so you can keep yourself healthy with like checkups and cancer screenings and all that good stuff. Yeah, exactly. So today on the show, I'm going to bring you a version of the reporting I did for NPR's radio show and for its podcast, Life Kit. It's about how to choose a health insurance plan. So whether you're aging out of your parents' plan, you're ready to switch things up, or you're uninsured and you want to see if you have any workable options. Selena has brought the experts to guide you where to look for that coverage, like how to narrow down plans and how to get trustworthy help if you need it. You are listening to Shortwave, the Daily Science podcast from NPR.

A lot of people in the U.S. don't have health insurance. About 28 million people. Certainly for many of them, it's because there are. are no affordable options. But if you're uninsured, it's important to know that almost half of the uninsured qualify for free or low-cost plans. Sometimes people don't know these programs exist or how to sign up. That's what this episode is here for. The first thing I tell people is, do not Google, I want health insurance.

That's Sabrina Corlett. I'm a research professor at Georgetown University, and I co-direct something called the Center on Health Insurance Reforms, which essentially means that I study health insurance all day, every day. Sabrina Corlett says, don't Google it. Instead, I'm going to tell you where to start searching for options. Here is the first takeaway. Know where to go. It's not obvious, and it varies depending on your age and job and financial situation. So let's walk through the book. basic places you can find insurance. In this country, it is a truly wacky patchwork quilt of options. First, we're going to talk about the public insurance options you might have access to. If you're 65 or older, you can sign up for Medicare. It's a federally run program. The government

pays for your health care. There are some caveats here about what Medicare doesn't cover. Some people buy extra plans to cover extra things. You can find lots of info at Medicare.gov. Medicaid is the health insurance program for people who are low income. It covers a lot of people, 80 million Americans. Medicaid is run by the state you live in and funded by both the federal and state governments. The details of whether you're eligible depends on where you live. Then there are the private health insurance options. The vast majority of us get our coverage through our employer if we are under the age of 65.

You might have a choice of one insurance company or multiple. And the employer typically will cover between 70 and 90% of your premium cost, which is pretty nice. If your job offers health coverage, your HR or benefits department should walk you through how to explore and select your options. It might be something like an online benefits portal. If you don't qualify for any of these, there is another option. Starting in 2014, we have something called Obamacare or the Affordable Care Act Marketplaces. And I sort of sometimes think of that market as the market of last resort. Your employer doesn't offer you any coverage.

You're not eligible for Medicare because you're not old enough. You're not poor enough for Medicaid. You can go to the marketplaces, apply for financial help, and choose a plan there. If you hear marketplaces or the insurance exchanges, they're the same thing. They refer to the online shopping tools you can use right at health care.gov or through your state. Some states run their own marketplaces like Your Health Idaho or DC HealthLink. If you live in one of these states, not to fear, healthcare.gov will still get you there. Healthcare.gov will also tell you if you qualify for Medicaid and help you figure out how to enroll in your state.

It's important to know about all these programs before you start to look for health insurance because it can be scary out there on the internet. Remember how we told you not to use your favorite search engine when you're shopping for health insurance, Sherry Moore made that mistake. She's a retiree in Tampa, Florida, and she filled out an online interest form with her contact information to allow health insurance brokers to contact her. The first day I did it, I got like 20 phone calls, back to back to back. And everybody told me the same thing.

I mean, we've got great raids. I'm like, you know what, I just want to look at it. I want to think about it. She was still getting calls five months later. You have to be super careful about this, not just because getting tons of phone calls is annoying, but also because some of the health insurance plans people might be trying to sell you are short-term or skinny plans. They might seem very appealing because they're cheap, but they also might not cover some basic things like prescription drugs and annual checkups, which a lot of experts warn make them not a very good deal.

So as Sabrina Corlett says, avoid those flashing online ads and interest forms. Just go straight to healthcare.gov. No matter what state you live in, you can go through that portal. If you're scrambling for a pen and paper at this point, don't worry. A written version of this episode is at npr.org slash life kit with all the links you need. Now presumably you're in the right place. You're starting to weigh your options. How hard this is is going to vary a lot.

Maybe you're picking from one or two options through work, ask your coworkers what they like, call it a day. On the other hand, if you're shopping in the Affordable Care Act marketplaces... Here in Texas, in our market area that we help serve clients in, we had 76 plans to review with clients. Yikes, that's a lot of plans. That is Erin De Laot, by the way. He is the director of health initiatives with an organization called Foundation Communities in Austin. He says, even with dozens of options, you can narrow it down with some basics. Which brings us to the second takeaway.

Use what's predictable about your health to guide you. Aaron Della O says, start with this question. Do you want insurance for that catastrophic event that might happen? Or do you know you have a health issue now that you're going to need ongoing care for? If you're pretty healthy but you want that protection, if, heaven forbid, you get a bad injury or a serious diagnosis, that might steer you towards more basic plans. If you have ongoing health needs you know you'll need coverage for, those can be really useful for narrowing your options down. Aaron says, think about the prescription drugs you know you'll be taking, the doctors you want to be able to

see, and the hospital you'd like to go to if you need it. If there's a plan that doesn't have your provider or your medications in network, those can be eliminated because if you really want to stick with your provider and you know you're going to need these prescriptions ongoing. Let's find a plan that's going to cover those. One thing to note, Sabrina Corlett says, is that some plans have more flexibility when it comes to covering things out of network than others. You may have a choice between what's called an HMO or a PPO. And without getting too wonky, HMO is typically a plan that doesn't let you see out of network

providers or you can, but you're paying 100%. But a PPO will give you a lot broader choice of providers. It might be a little bit more expensive to see an out-of-network provider, but they'll still cover some of that cost. You can think about it like this. HMOs or health maintenance organizations have pretty closed networks of providers. If you see those providers, you're good. If you see an allergist, your friend recommended, who's not in that network, your costs are all on you. PPO's preferred provider organizations are a bit more flexi.

They also have a network of providers, but you can see that allergist and your plan will still chip in. All right, you've done your best to look in a health crystal ball to start zeroing in on a plan. Next, we're going to talk about the cost side of things. The third takeaway is learn your health insurance vocab. We're going to walk you through what all those jargony cost terms mean and how to use them to find a plan that's in your budget. I know it's hard to navigate. what a copay is, what's my cost sharing, what's my deductible, what's my max out of pocket? Let's start with the simplest one.

The premium is the amount you pay every month, like your cable subscription or any other bill. Pretty straightforward. Then things get tricky with something called cost sharing. This is your share of the cost for your health care. You pay these costs on top of your monthly premium. Whenever you use health care services like going to the doctor or picking up a prescription, anything like that. One piece of this is your deductible. Deductable is an amount of money that your insurance will not cover until you spend a certain threshold of expenses in health care.

So if you have a $5,000 deductible, that means you'll be covering the first $5,000 of your health care expenses for the year before your insurance starts covering it. At the beginning of every year, your deductible resets to zero. If you don't use a lot of health care in a given year, you might not even get close to paying your first. deductible. If you do use a lot of health care, the first few appointments and prescriptions you pick up early in the year might seem extra expensive because you haven't hit your deductible yet. Your insurance is kicking back and when you hit that magic number, it'll sit up and start kicking in. After that, you do still have some costs when you go to the doctor in the form of a co-pay or co-insurance. A copayment is a flat dollar amount that you would pay for, say, a doctor's

visit. And then you have something called co-insurance. That is a percentage of the total cost that you pay. All of this cost sharing does have a limit, though. If you use a lot of health insurance, you might hit your max out of pocket. And that is... The most you'll ever have to pay this year for your health care. So a lot of people who have babies often get their max out of pocket covered very quickly because it's expensive to have a baby. So say you're in a plan that has a deductible of $2,000. After you hit your deductible, you'll still be paying copays or co-insurance until you hit this even higher ceiling of the out-of-pocket maximum, say it's $4,000. After that, no co-pays, no co-insurance, your insurance will pay 100% of the cost of all covered health services for the rest of the year.

Here's one way of thinking about these costs that might be helpful. Insurance companies use these costs kind of like dials. A basic plan might dial back the monthly premium so it's not too much every month, but then have a high deductible. If you chose that, you'd be making a bet that you wouldn't need to use a lot of health care in the coming year. If a plan dials up the premium, so you're forking over quite a bit every month, you'll likely have much lower other costs like deductibles and co-insurance. If you're shopping on health care.gov, there's a shorthand for these different levels of plans, and that is the metal, categories. Bronze is the most basic plan. Silver is a bit better than gold, and the top line

plans are platinum. It also has this handy tool that shows the estimated yearly cost, taking all of these various costs into account and giving you a ballpark of what your overall health insurance costs might be in the year. Some other search tools might have this as well. It's pretty useful, so you don't have to do as much math in your head. Okay, once you know what all these terms mean, then you'll need to roll up your sleeves for takeaway number four. Think about your budget. What can you manage to pay for your health plan? Which plans are available and affordable to you might vary a lot depending on where you live, your income, and who's in your household.

That information will help you figure out what your costs will be after possible government subsidies. Now, the income the plan is asking about isn't what your income was this past year. You're looking forward at what your income will be next year. Thinking about are you eligible for a promotion that you think you're going to get? Are you working in a temporary position now and you don't think that's going to continue into the new year? What will your income look like? Seriously, finding a good plan can be tough. Well, if you're shopping for a plan in the Affordable Care Act marketplaces, I have good news.

The fifth takeaway, take advantage of free, impartial, professional help. Again, don't Google or click on ads to find it. Actually, head back over to health care.gov and click on find local help. You can put in your zip code and look for an assister, sometimes also called a navigator. Erin Della O is one of these. They're given government grants and their only job is to sign people up for health insurance. So we are unbiased. We're not contracted with insurance agencies to help people find insurance that they want them to have. So we do it completely autonomously, impartially. Really, it's about what's best for the consumer. A lot of people have benefited from reaching out to a navigator. Deborah Kagan called one when she was moving from New York State, where she was covered by Medicaid, to Florida, where she didn't qualify for Medicaid. She was really scared. My biggest fear was having type one diabetes.

and without my medication, I'm dead. And during COVID, I also found out that I had breast cancer and I had a brain tumor and it was just one thing after the other. She connected with an assistant at the Family Healthcare Foundation in Tampa and was able to sign up for a $0 marketplace plan that covers all of her medical needs. They saved my life. I mean, the navigators were amazing. And they knew everything, all the updates and guided me through every step of the way.

and we're just beyond helpful. There are also insurance brokers who often get commissions from insurance companies. Sabrina Corlett says the good ones want happy customers, so they'll get you in a good plan. Go through either health care.gov or your local state department of insurance to find somebody that's licensed and in good standing. In 2021, the sign-up period starts November 1st and runs until January 15th. Open enrollment at your work and Medicare are going to be different, although they're usually in the fall as well. For Medicaid, you can enroll at any time. Aaron Della O says, even if you've already got an insurance plan that seems fine and it's tempting to just let it automatically renew.

Look and see, are you eligible for additional subsidies to lower the cost of your monthly premium? Is there a plan that is with those increased subsidies that you can now get a, silver plan as opposed to a bronze plan, which lowers your deductible, which lowers your co-payment. Like an annual health insurance checkup. He says, give yourself a few hours to get it done, especially if you really want to weigh different options and call your doctors to double check they would take a new plan. His team aims to get people in and out, enrolled in a plan in an hour and a half. The sisters like Erin actually work year-round because if you have what's called a qualifying life event, you get your own personal enrollment period that can come

at any time of the year. Say you have a major change in income or you have a baby or, you know, death in the family, any of those things, you can report that change and they will do a reassessment of your situation. For everyone else, don't miss the annual open enrollment period, your window of opportunity to get enrolled in a new plan. Health insurance is important, but it's also confusing. It asks a lot of us. Hang in there, find people to help, and make sure you get covered. Thanks again to Sabrina Corlett and Aaron De LaO. This episode of Life Kit was produced by Janet Ujung Lee. Megan Kane is our managing producer. Beth Donovan is our senior editor. Our production team also includes Audrey Wynn, Andy Tagle, and Claire Marie Schneider.

Our digital editors are Beck Harlan and Wynne Davis. I'm Selena Simmons-Duffin. Thanks for listening.