Choosing a Plan

When choosing a health insurance plan, carefully consider the plan's rules and policies. Find out the cost of the plan (premium), what medical services are covered, how the payments work, and how much choice you will have when choosing providers and hospitals. Ask for a summary of the plan's benefits.

Read the plan's brochure closely before you sign up. Ask questions about parts you don't understand. It may be helpful to know these terms:

• Deductible: The amount of medical costs you have to pay each year before your insurance plan begins to pay for your care
• Out-of-pocket expenses: Health care costs you have to pay with your own money
• Co-pay: A set fee you pay each time you receive medical care
• Premium: The amount you pay to have a health insurance plan
• Exclusions (limitations): Medical services that aren't covered by the insurance plan
• Out-of-network: Health care services received outside of an insurance plan's network of providers
• Pre-existing condition: A health problem you already have when you apply for health insurance
• Health savings account: An account a person or employer sets up to save money for health care costs
• Formulary: A list of medicines that are preferred by an insurance plan
• Denial of claim: When an insurance plan refuses to pay for a certain health care service

It's a good idea to contact your doctor's office to find out which health plans are accepted and how the payments work.

Coverage for medicines

Find out how your insurance covers medicine costs. Some insurance companies cover only generic medicines if they are available, rather than brand name medicines. With some plans, you may have to pay more for medicines that aren't on the plan's list of preferred medicines (formulary). Some insurers cover medicines that are bought only at certain pharmacies.

A formulary may put drugs into three groups, or "tiers," based on how much your health plan will pay and how much you will have to pay.

• Group 1: Generic drugs. These are usually drugs that have been in use for a long time, have proven benefits, and cost less to make and sell. You pay the least for drugs in this group.
• Group 2: Brand-name drugs that are on the formulary. Your health plan may have agreements with some drug companies to offer their brand-name drugs at a lower cost. You still pay more for the "formulary" brand-name drug than for the generic, but it costs less than brand-name drugs that aren't on the formulary.
• Group 3: Brand-name drugs that are not on the formulary. These drugs cost more because your health plan doesn't have an agreement with the drug company to reduce the price. When the health plan pays more, so do you.

If you have a choice between plans, check what your co-pay for prescription drugs will be, the maximum amount the plan will pay in a year, and other details.

Online help

Some organizations, such as the National Committee on Quality Assurance (NCQA), give reports on insurance companies. This may help you choose which plan is best for you. Find out more at www.ncqa.org.

Questions to ask

When you are choosing a health insurance plan, think about questions you want to ask. For example:

• What benefits and services are covered?
• What plan does your doctor accept?
• Which doctors are available in the plan?
• Does the plan offer coverage for foreign travel?

After you have a plan

After you get a health insurance plan, keep your insurance card with you. Save your insurance company's phone number in your phone's memory so that you have it available.

Many plans require you to contact your insurance company before having an elective procedure, such as a surgery or certain medical tests, or for a hospital stay. If you have a medical emergency, get help for the problem first. After the emergency is taken care of, contact your insurance company as soon as you can.