You pay your premium, get your insurance card and go to the doctor. Simple, right? Not always. Dealing with health insurance companies and health care providers, such as doctors and hospitals, is complex. The process for newly insured patients can be confusing and comes with high stakes: One wrong step can result in a hefty medical bill. Avoiding pitfalls requires understanding the basics of health insurance and how to use it.
Newly insured? You’re not alone.
About 11 million adults were newly insured in 2014, according to a report from the Kaiser Family Foundation. About half of these people are under age 35, and most of the newly insured are low- to middle-income earners, so cost is a definite concern.
Even with insurance, medical care costs money. But you can better manage these costs by understanding how to use your policy.
Here’s what you need to know if you're new to health insurance:
1. Your insurer’s website is a good source of information.
Register through your insurer’s website. Here you can find important information such as the directory of in-network providers, information on specific claims and how close you are to hitting your annual deductible— the amount of money you must put toward your care before your insurer starts picking up a greater portion of the tab.
“Most health insurance companies have made attempts to improve their websites, both for patients and providers,” says Claire Freeman, founder and CEO of Compass Co-Pay, a patient advocacy firm.
2. Your insurance network is a select group.
Your insurance company contracts with medical providers to offer services at a discounted rate. These doctors and facilities are your insurance network, and you’ll receive the greatest benefits of your policy with them. Go outside of that network, and you’ll pay more for care. Always double-check your insurer’s website to be certain a provider is in your network.
3. You still have some control over medical costs.
The amount you pay at the receptionist’s desk, called your copay, may be your first thought when it’s time to go to the doctor, but there are other factors at play in how much you’ll pay for medical care. If you have a deductible, it makes sense to price shop for health care by calling ahead to get cost estimates and weighing these against the quality of service you can expect. Also, choosing generic drugs over brand-name drugs and even negotiating medical bills after the fact can go far in saving you on out-of-pocket costs.
4. Some services are free.
Under the Affordable Care Act (ACA), numerous preventive services and screenings are free under your insurance, including blood-pressure screenings, annual well-woman visits and immunizations. Make sure you tell your doctor that you’re interested in receiving such free screenings when you set up your appointment, as you are likely to see a charge if she provides services or counseling outside of the list.
5. The explanation of benefits (EOB) is an important document.
Your insurer will send you a document called an explanation of benefits (EOB) that shows how it processed payments to your medical provider, including any balance that may be left.
“Many people routinely make it a habit to toss out their EOB,” says Freeman, who says the document is a valuable tool. Freeman recommends you check it, looking for errors or problems that could lead to unnecessary medical bills. Compare it with the billing statement from your doctor and look for:
● total amounts charged, and whether there are duplicate charges;
● dates of service;
● how much is being applied to your deductible;
● whether the “patient responsibility” on your EOB matches what the provider is billing you for.
6. Insurance claims can still be denied.
There are many reasons your insurer may refuse to pay a claim, including preventable coverage issues, such as failing to get a referral for a specialist, or mistakes made by your medical provider’s billing office. If a health claim is denied, call your insurer to find out why and what you can do to change that. If you believe it was denied without good reason, you can appeal the decision.
7. Have more questions? Call customer service.
“Your health insurance website and customer service representatives are your best source of information” when you have questions about your coverage, Freeman says. Don’t worry about your question being “dumb” (it isn’t) and make time to call, even if you’re busy, she adds.
Using a new health insurance policy wisely requires taking deliberate and well-informed steps, whether it’s your first time with insurance under the ACA or your first policy ever. Take some time to understand your coverage and ask questions to avoid unexpected medical bills and make the most of your health care spending.