8 tips for navigating the health insurance maze

How not to get stuck with bad plans or unneeded expenses

Published: September 25, 2014 04:00 PM

Open enrollment season for health insurance is coming up soon. Here are eight things you should know.

1. Enroll on time

If you buy insurance on your own, be aware that the open enrollment period is shorter for 2015—from Nov. 15 through Feb. 15. If you miss that deadline, you can’t get insurance for the rest of 2015 unless something major happens, such as having a baby or losing your job. Open enrollment for Medicare Advantage and Medicare drug plans will be Oct. 15 through Dec. 7. Most employers offer new plans to employees around the same time.

2. Research plan quality

Check out our free rankings of health insurance plans, including Medicare Advantage and Medicaid plans, from the National Committee for Quality Assurance. For Medicare plans, you can also get extensive quality information at Medicare.gov.

3. Don’t auto-renew

Most plans will auto-renew if you don’t tell them not to. We strongly recommend checking out your options before re-­enrolling. This applies whether you have a choice of plans through an employer, buy on a state marketplace, or opt for a private Medicare Advantage plan. Plans change from year to year; so do your circumstances. You might have developed new health care needs that don’t play well with your provider network, or drug formulary. And in the case of marketplace plans, if you've been getting a premium subsidy your costs may change substantially unless you update your income information and review your options.

Why the cost of health care is so outrageous, and what you can do about it.

4. Get rid of bad pre-Affordable Care Act plans

We recently heard from a reader with a plan he bought on his own before the new health law rules took effect. But now his wife is pregnant and his current insurance excludes maternity benefits. He wanted to know where he could get insurance that would cover maternity care, which all plans sold nowadays must do. Alas, the answer was that he can’t until open enrollment starts on Nov. 15. If you have a pre-Affordable Care Act plan, make sure you understand its limitations.

5. Don’t accept an automatic replacement plan

If the plan you chose from your state marketplace last year is being discontinued, the government allows the insurer to auto-enroll you in a replacement plan—unless you say otherwise. Check with your marketplace first to see whether you can get a better deal.

6. Don’t automatically take COBRA

This program used to be a lifeline if you lost your job, because it let you keep your employer’s health plan for 18 months. But now it’s more of an albatross. That’s because COBRA requires that you pick up the full cost of the plan, which can hit $600 or more per month. Thanks to health care reform, you can almost certainly find equally good insurance for a better price on your state’s marketplace, especially because your lower income will probably qualify you for big tax credits. Carefully compare the two before paying your first COBRA premium. Once you’ve enrolled in COBRA, you can’t switch to a marketplace plan until the next open enrollment period.

7. Shop around for care

Obviously you can’t do this for emergencies, and it’s irrelevant for catastrophic situations such as cancer or a heart attack. But for a routine service, such as an MRI, or for things you can plan in advance, such as childbirth, register on your health plan’s website and look for cost estimators. You’re likely to find startling variations in prices for the same service, depending on where you get it.

8. Master your plan’s rules

Don’t assume that all plans are designed alike; they’re not, and what you don’t know can cost you. Say you wake up one day with a fever and a sore throat. A trip to your doctor might cost you a $40 co-pay. An urgent care center might set you back $60. An emergency room might cost $1,500. When you get a new plan, spend a few minutes with its standardized Summary of Benefits and Coverage form. It’s not exciting reading, but it can save you big in the long run.

Click on the image at right for rankings of health insurance plans nationwide. Use the tool to:

  • Choose a plan category such as private HMO or PPO, or Medicare HMO or PPO.
  • Choose a state.
  • Customize your search to compare plans' scores and their performance in measures such as consumer satisfaction and providing preventive services.
Editor's Note:

This article also appeared in the November 2014 issue of Consumer Reports magazine.

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