Shopping for health insurance is complicated when you have a chronic condition, but choosing the right plan is important. It can help you save money and ensure you live a healthier, happier life.
About half of all Americans have a chronic illness, and those conditions accounted for 86 percent of all health care spending in 2010, according to the Agency for Healthcare Research and Quality. Most people with chronic conditions quickly meet their annual deductibles and then some, spending more than $6,000 annually on average, according to the National Association for Chronic Disease Directors.
Many with chronic conditions are used to the spending, but the newly diagnosed may not know what’s in store financially when purchasing insurance. Instead of simply choosing the least expensive plan, it’s important to compare referral policies, cost sharing and drug plans, and to ensure your doctor takes your new insurance.
The good news: Health plans are easier to compare than ever before, thanks to an Affordable Care Act requirement that plan summaries be clear and jargon free. Here’s what to look for in your next plan.
A network that includes your doctor
If you have a chronic condition, you probably know and trust a doctor or two. If you want to keep your physicians without overpaying, ensure they are in your new health plan’s provider network. Doctors who participate in your insurance network will cost less than others because your insurer has agreed to pay their charges under a negotiated rate.
Some doctors practice in several locations, and some may not be covered by your new plan. Here’s how to ensure you can keep your doctor:
● When comparing plan options, have the names and office addresses of any favorite doctors handy.
● Go to the insurer’s website and search the provider network directory for your doctor’s name.
● Check to make sure your preferred location is covered.
No referral requirement
Depending on your health plan, you may be required to see your primary care physician before you see a specialist. Particularly if you have more than one condition, this could end up costing you a lot of time and money.
In a health maintenance organization (HMO) or an exclusive provider organization (EPO) plan, doctors keep costs low by coordinating care with a group of other doctors they know well. In one of these plans, your doctor may refer you away from your current specialist. Without a referral, you’ll be charged the doctor’s cash pay price.
If you want to keep your doctors, you may want to stick with a preferred provider organization (PPO) or point of service (POS) plan in which services by non-network doctors generally are partially covered. The plans you’re comparing should include this information in their titles.
If keeping your current doctors isn’t important, HMO and EPO plans will likely have lower out-of-pocket costs.
Higher service levels
If you have a chronic condition, you’re more likely to reach your deductible because you tend to need more health services. Having a plan that costs a bit more per month but has lower out-of-pocket costs could save you money and make your costs more predictable.
Different service tiers, starting with bronze at the low end and rising through silver, gold and platinum, determine your deductible and costs until you reach your out-of-pocket maximum. Most people choose a silver tier plan on government marketplaces, according to the Centers for Medicare and Medicaid Services, but you might want to opt for something richer.
“I recommend a higher-tier plan for people with chronic conditions,” says health insurance expert Sally Poblete, CEO of Wellthie, a health insurance selection software company. Those plans will cost more per month but cover more, translating to lower overall costs, she says.
A generous drug formulary
If you’re taking medication, check the formulary, or list of covered drugs, of any health plan you’re looking at. If your drug isn’t on the formulary, you could wind up paying a lot.
Whether it’s covered is only half of the equation; how much you have to pay for a drug under your plan, and whether the plan uses copays or coinsurance, will also affect overall cost. Coinsurance is a percentage of the drug’s cost you pay, typically 10 to 40 percent.
Lower copays and coinsurance percentages will keep costs down year-round; if your drug is expensive, copays are preferable because they tend to be lower than even a low coinsurance rate.
Disease management perks
“Health insurance policies usually offer a free care management plan to help you manage a condition,” Poblete says. For example, a diabetes care plan might include a health coach or nurse to help you make healthier decisions and coordinate doctor visits, saving you money and stress.
Since many illnesses are complicated or caused by obesity or smoking, most health plans also offer wellness initiatives such as a gym membership, a fitness tracker or discounted smoking cessation aids.
The bottom line
Whatever your condition, investigate your plan options. You might save yourself a lot of hassle— and potentially a lot of cash.