E.R. may have made doctors sexy, but it hasn't done a hell of a lot for health insurance. You've probably got an opinion on the health care system and what Hillary didn't do for it, but do you have any idea how to choose the policy that's right for you?
Whether you receive health insurance from your employer or purchase it on
your own, there are essentially three options: health maintenance
organizations (HMOs), preferred provider organizations (PPOs), and
traditional indemnity insurance. HMOs are health plans that deliver and
pay for their members medical care in a certain geographic area. They
currently provide care for more than 20 percent of the U.S. population, and come in three varieties:
1. In a staff-model HMO, such as Harvard Pilgrim Health Care, the plan owns and operates health centers staffed
by salaried physicians. The center usually includes physicians' offices,
a pharmacy, optical shop, x-rays and labs. This is a great option for
urban carless folk because they can fulfill all of their medical needs in
one place without trekking to a physician's office, then a lab, and then a
pharmacy. (Harvard Pilgrim Health Care is technically referred to as a mixed-model HMO, but the staff-model is the core of the health plan.)
2. A group-model HMO, such as Kaiser Permanente, is a network of multi-specialty physicians in private group practice that provides a broad range of medical services under one roof. It is similar to a staff-model HMO, but the doctors are not employed by the health plan.
3. An independent practice association (IPA) HMO, such as United Healthcare, is really just a contractual network of physicians in private practice that agree to see patients signed up with a health plan. Most HMOs in the U.S. are IPAs.
HMOs, which limit you to their network of physicians, do not require
deductibles (fixed amounts of money you are required to spend on medical
care before the insurance kicks in), but they do have co-payments for specific
services (e.g. $10 for an office visit or $5 for a prescription). The
main advantages of HMOs are that they provide a full range of medical
benefits plus some bonuses, such as eyeglass discounts, health center
memberships, low out-of-pocket costs, no claim forms, and convenience. HMOs were also pioneers in the field of preventive medicine (e.g. regular physicals, cancer screenings, etc.) and although many other plans have now adopted preventive care, this principle remains at the core of HMOs.
Preferred Provider Organizations (PPOs) are similar to IPA-model HMOs, but their networks tend to be larger, and they give you the option to seek medical care outside the network,
albeit at a higher price. If your doctor is in the PPO network, you pay a
copayment (e.g. $15) or coinsurance (e.g., 20 percent of the cost of treatment). PPOs also provide a full range of benefits, have moderate out-of-pocket costs, but require claim forms and do not provide all services under one roof.
Traditional indemnity insurance allows individuals to see any physician, but they are required to pay a deductible and high levels of coinsurance. These policies are no longer popular because of their high out-of-pocket costs compared with HMOs and PPOs.
When choosing a health plan, the primary considerations are cost, choice, coverage and convenience:
The National Committee on Quality Assurance publishes a concise brochure
on how to choose a health plan, Choosing Quality: Finding the Health Plan That's Right for You.
If you are employed, your choice of health plans is limited by what your
employer offers. If you are unemployed, underemployed, or self-employed,
you may have to purchase insurance on your own. Most health insurance
companies offer individual policies, and many states have enacted
individual health insurance reforms, requiring all insurers to offer
affordable individual insurance policies. The Intergovernmental Health
Policy Project at George Washington University
tracks which states implement individual health insurance programs. You
can also call your state's Division of Insurance to inquire about available
individual health insurance options.
Catastrophic health plans are an additional, affordable option for
individuals purchasing their own insurance. These plans have low
premiums, but high deductibles, sometimes more than $2,000 per year, and
high coinsurance amounts (e.g. 20 to 50 percent). This means that you must
incur $2,000 of medical expenses in a year (the deductible) before the
insurance plan pays anything, and even then, you are responsible for
paying 20-50 percent of the cost, depending on the coinsurance level. These
plans, which typically allow you to choose any physician, are best for
people with extremely low expected medical costs, such as a male in his
early twenties who rarely sees the physician and has a physical every 3-5
years. Note: This is not a plan for hypochondriacs.
Once you have a health insurance plan, you need to pick a primary care
physician. Choosing insurance is usually an economic decision (highest
quality at the lowest cost), but choosing a physician is more of a
personal decision. Factors such as the physician's gender, age,
personality and location are key considerations. For example, many women
feel more comfortable discussing their health with other women, and many
gay men and women prefer a gay or gay-sensitive physician. (Many
health plans compile lists of gay or gay-friendly physicians, and many
cities have gay and lesbian health centers where you can receive care or
get referrals to "friendly" community physicians.)
There are also objective quality standards that you can apply when
choosing a physician. What medical school did they attend, how many years
of experience do they have, are they board certified (passed the state
medical exam), are they licensed, and have they been disciplined by the
state medical board? If you join an HMO, your choice is limited to the
physicians in the HMO's network, but they have usually been pre-screened by
the plan, using many of the same quality standards listed here.
You might also want to know how your doctor is paid. Is a percentage of his or her salary based on how much of the plan's money he or she doesn't spend on patients? Tripod's Doctor Bob addresses this quandary of '90s medical insurance in Ask the Doctor. As Doctor Bob says, "If it's something that concerns you (and it probably should), then you've just got to go ahead and ask the doctor."
In the end, it is your call. The most qualified physician could be wrong for you simply because your personalities clash. It is useful to "test drive" a physician -- go in for an initial check up or speak to him or her on the phone; if you don't feel comfortable, choose another. It is your health, after all.
More on health insurance:
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