Policies

Take the time to Understand Your Health Insurance Policy

Having a good working knowledge of your health insurance policy can prevent you from paying hundreds, maybe even thousands, for out of pocket procedures and medications.  Health insurance plans are constantly being restructured.  Therefore, there is no better time than now to understand your policy.  But, how much should you know?

The key is to gain enough knowledge about your policy that you are familiar with the policy’s terms and coverage.  You don’t have to know every exact detail, but you should have the basics of what you would need to pay for and why.  It is recommended that you highlight or underline important points and make notes on your policy so they are easy to find later.

What to look for when reviewing your policy.

• Understand the terminology used in the policy.  You should always ensure you understand the wording used in your policy.  Most policies have a glossary of terms included in the policy.  Use this glossary to find out how your insurance company defines a specific term.  Ask someone if you don’t understand a word or a phrase!
• Is there a waiting period?  Some policies require a specific amount of time to pass by prior to the policy’s coverages are made available to an individual.  Seek medical care too soon and you’re responsible for paying the full amount of the medical bill.
• Determine the policy’s exclusions.  The exclusions are conditions that won’t be covered by the insurance policy.  This is very important if you beleive you may need health insurance for specific conditions.  For instance a woman wants to have children some day, but the policy does not cover maternity care.
• Are there any pre-existing conditions?  A pre-existing condition is a condition that an insured had prior to becoming insured.  Some policies never cover pre-existing conditions.  Some will cover them after a certain time period.  Other policies may cover pre-existing conditions.  What does your policy state about pre-existing conditions.
• Know the of your out-of-pocket costs.  Basically, know how much are you going to have to pay out of your own pocket.  There are many different items that will affect your out-of-pocket expense.  They include your deductible, co-pay, and coinsurance. 
• Find out if you need to select a physician from a network.  Many insurance companies require individuals to select a physician from a network for charges to be paid.  When possible, it is also recommended that you review the list of physicians in the network to ensure the physicians you prefer to see are in network.
• Note what hospitals, labs, and other providers you must utilize.  Use the wrong hospital (or lab) and you’ll pay more.  Sometimes even network physicians will inadvertantly send patients to out of network providers.  Always ensure your providers are in network.
• Verify if you need previous approval or a referral for care.  Some insurance companies require a primary care physician refer you to a specialist.  Others require the insurance company approve certain medical procedures. 
• Confirm what medications are covered.  All insurance plans have a drug formulary.  A drug formulary is a list of drugs or medications that are preferred by your specific insurance plan.  Usually you pay more for a drug or medication that is not on formulary.

Understand your policy before you need it.

Many individuals don’t read their insurance policy until they need too for either a medical emergency or an acute illness.  Don’t wait to understand your policy!  Understanding your insurance plan can be confusing, especially when you aren’t healthy.  Always call you insurance company if need assistance understanding your healthcare policy.