How to Compare Health Insurance

Health insurance is as important as buying life insurance. It is less expensive when compared to other insurance plans. Finding the right kind of coverage can be easier if you know how to compare the different insurance plans that are available.

Difficulty: Moderate

Instructions

1. Ask your employer about the health insurance coverage in your office. Your employer generally provides the easiest and the best options. Sign on with them, as you can save more and get a more comprehensive coverage.

2. Study the Consolidated Omnibus Budget Reconciliation Act (COBRA) coverage. This is the best coverage you can get if you have been recently laid off or are unemployed. You can extend your coverage from 18 to 36 months using the same group insurance under your employer. Be prepared to pay for the premium separately either to your employer or directly to the insurance company.

3. Find a health insurance agent and collect information about the different plans available. Visit the NAHU (National Association of Health Underwriters) at their website, www.nahu.org, and find a local office in your area. This is one of the best ways to find and compare health insurance plans.

4. Compare Fee-for-service, Preferred Provider Organizations (PPOs), Point of Service (POS) and Health Maintenance Organization (HMO) insurance plans.
   • Check out the details of fee-for-service plan. It allows you to choose which doctors to visit. However the premium for this plan is higher compared to other insurance plans. In cases when a specialist is needed, you can choose one at your own discretion.
   • Tthe PPOs plans do not offer you the flexibility on which doctors to visit. You must choose one from the list of physicians coming under this plan. The premium for PPOs is lower compared to fee-for-service plans.
   • Remember, the POS network requires your physician to choose a specialist for you while other features of the plan are same as PPOs.
   • Keep in mind that HMOs are highly restrictive in allowing you service flexibility but they are the least expensive in terms of managing your health benefits.
   

5. Assess the coverage on drug prescriptions. The best way to go about this is by looking for medication that you usually buy for a pre-existing condition and compare the plans that offer it without an additional cost.

6. Check for a renewal clause. It should pre-qualify you for automatic renewal at the existing premium rates regardless of your medical history. It should also have a no-dropping clause.

7. Consider the time it takes to take care of your medical problem. Some plans will keep you waiting before you can see a physician, while others will give you instant attention.

Tips & Warnings

• You can control the cost of your fee-for-service plan by increasing your deductible.
• Inquire about plans that have an impact on your premium due to a pre-existing medical condition.
• While comparing, look out for other sources of health insurance. Institutions, alumni associations, fraternities and other group associations now have affiliations with several medical associations and organizations that provide great health coverage to members.
• Always compare for PCQ. (Price you pay, Coverage you receive and Quality you expect).
• Avoid a health plan that does not provide coverage for at least $1 million in health care costs.