October 31, 2014

A sea of changes in health care means consumers need to shop carefully for insurance.

Electing health insurance isn’t as easy as buying a new sofa or purchasing a cell phone plan. But it’s getting better, thanks to the efforts by the government, insurance plans, insurance brokers and consumer advocacy groups to educate consumers on their choices.

The health insurance marketplace has experienced seismic changes in recent years due to health care reform and the advent of the federal Affordable Care Act. Moreover, the cost of health care is continuing to rise, many hospitals and physician groups are realigning, and Americans themselves are becoming wiser and more proactive about their health. This somewhat chaotic scenario means that most people need to put a little more time and effort into choosing health insurance plans during the open enrollment period that typically occurs each fall. 

“Each year, everyone has to carefully review their benefit options,” says Teresa David, chief operating officer of Facey Medical Foundation. “Look at the full range of benefits and make sure your physicians and hospitals are in the networks. Things change from year to year. It’s worth the time and effort to carefully review options and do the research ahead of time. In addition to written materials you may receive, don’t hesitate to go directly to the health plan website or call their member service line to obtain more information.”

Each health plan is required to send a notice of changes or evidence of coverage to its existing customers, says Martha Gonzales, a health insurance broker specializing in Medicare and individual/family health plans. Health insurance brokers can help you find a plan that meets your budget and physician preferences.

“A broker who is an independent agent is in a position of neutrality,” she explains. “We want to best serve our clients. We 
can let the patient navigate the decision with all the tools and resources available to brokers.”

Now is the time to attend a lecture or contact a broker for assistance, says Bruce Johnston, a broker who specializes in assisting Medicare recipients. “People should start the process early. Get in touch with someone right after October 1. Find a broker to do an annual insurance review. It takes about an hour.”

Taking stock of your coverage 

What should you consider during open enrollment? According to the experts, one of the most common mistakes consumers make is to do nothing.

“Some people don’t check their drugs to see if the formularies have changed,” Johnston explains. “They don’t check out the benefits from one HMO to another. On paper, they all look the same. They should talk to a broker to understand the nuances.”

Even consumers selecting insurance through an employer-based system may not realize that those plans can change each year as well, David advises.

“In many cases now, an employer may offer a health plan that consists of a broad network of providers and also a product with a restricted network of providers,” she explains. “It’s to the employee’s advantage to review these. They have to be careful to see if their personal physician or preferred hospital is in the narrow network.”

Under the Affordable Care Act, Californians who are self-insured or who work for small companies can purchase insurance through an exchange called Covered California. Now heading into its second year, the exchange is growing and changing, with many more provider networks joining, including many Providence-affiliated providers.

Providence Health & Services continues to be a great choice for consumers, David notes. “We provide a full spectrum of services. Providence is an integrated delivery system where we promote coordinated care between physicians and hospitals. Providence has implemented a system-wide electronic medical record system, which allows physicians and hospitals to share data. That promotes better care and eliminates unnecessary testing. As a system, Providence treats each patient as a unique individual and is attentive to his or her personal needs.”

When selecting insurance, consumers also should pay close attention to understanding prescription drug benefits. Drug benefits usually are organized by tiers. A formulary is the list of medications a health plan covers. Consumers should do an assessment of the medications they take and then calculate what their out-of-pocket costs for those medications will be under a particular health plan.

“With a medication assessment, you can anticipate the out-of-pocket costs you’ll have,” Gonzales explains. “The idea is to maximize coverage and minimize cost.”

Understanding Medicare and Medi-Cal Options

Consumers with Medicare and Medi-Cal also need to re-examine their coverage each year, Johnston says. People who are eligible for Medicare for the first time should seek a consultation about the various Medicare services (parts A, B, C and D).

“If you do nothing, nothing changes. But there can be significant changes in plans from year to year. Your individual situation may have changed. The plan from last year may not be the best for this year,” he says. 
On the surface, many Medicare plans look the same, Johnston notes. “But if you go down to the details, you see there are substantive differences.”

Medicare and Medi-Cal recipients may be eligible for one of two special programs. One is the Medicare Dual Demonstration Project, a new program for people who qualify for benefits under both Medicare and Medi-Cal programs. These people commonly are called “dual eligible beneficiaries” and must carry several insurance cards and know how to navigate two or three separate systems to receive care. But under the Cal MediConnect program, they can enroll in a coordinated care system.

Dual eligible recipients will receive packets of information about their health plan choices and should review the material carefully, Gonzales says. “They need to be able to reach out to somebody, because if they don’t make a selection, one will be made for them. That may mean a relationship they value may not continue because they didn’t make that selection.”

Another program that may better serve some Medicare beneficiaries is the Medicare Chronic Special Needs Plan (C-SNP). This is for people with chronic health conditions, such as diabetes or cardiovascular disease, to help them manage their expenses. 

“This type of plan gives people a select drug tier where a lot of the medications they’re taking can be a zero or low co-payment,” Gonzales says. “That is a big savings to a lot of people.”

One client switched from a regular Medicare plan to the Medicare Chronic Special Needs Plan and saw her medication copays drop from $70 per month to $10 per month. “For a senior on a fixed income that’s a big difference,” she says.  

“If you do nothing, nothing changes. But there can be significant changes in plans from year to year. Your individual situation may have changed. The plan from last year may not be the best for this year.”