Consumers have a hard time comparing health insurance plans

Consumers have a tough time comparing health-insurance plans, according to a study by Consumers Union, the publisher of Consumer Reports and this web site.   

The study, funded by the Commonwealth Fund and the California HealthCare Foundation, looked at a new form that insurers must start using in 2012 that is meant to help consumers compare plans on an "apples-to-apples" basis. Researchers showed the form to 112 people in four cities. People liked the idea of the standard form and said it helped them focus on important criteria. But most were still confused about the cost-sharing information and often flummoxed in making comparisons among plans.   

When asked to actually use the forms in a practice exercise, for example, most people were still unsure what portions of their care the insurer paid for and what their out-of-pocket costs would be. Many also had trouble understanding how deductibles, the amount you pay before insurance kicks in, interacted with other cost-sharing provisions. Even people who did pretty well on the various exercises worried that they might have missed some "fine print" that would affect their out-of-pocket costs.

"Health insurance is really complicated," says Lynn Quincy, study director and senior health policy analyst at Consumers Union. "It's understandable that people are often confused and dread dealing with it, let alone sit down to actively compare plans. What this study showed us is that insurers and those implementing the health reform law are going to have to work very hard to simplify the information." 

Quincy suggests the forms might be more user friendly if they included hypothetical medical scenarios illustrating what a plan would cover and pay for. The National Association of Insurance Commissioners and the Department of Health and Human Services are working on developing such scenarios.

—Steven Findlay, M.P.H., senior health policy analyst 

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