How do I choose a health plan?

Health insurance plans come in more flavors than gelato. But luckily for sanity-loving people everywhere, they can all be sorted into four broad categories: indemnity plans (also called fee-for-service plans), point-of-service plans, health maintenance organizations (HMOs), and preferred provider organizations (PPOs). The first two flavors give you, the consumer, lots of options, but at a higher cost. The second two are considered managed care, so you have fewer choices, but the plans tend to be less expensive.

Once you’ve identified which flavor suits you best, give the policy the third degree and figure out:

• What hospitals and doctors are in the plan’s network? Are the hospitals Joint Commission-accredited? Check to make sure that the Dr. Frank you circled in the book is indeed your Dr. Frank.
• What’s not covered?
• Will I have continued care on my pre-existing conditions list? What will happen if I get cancer, get pregnant, or become disabled?
• Can I use an out-of-network doctor, and what will it cost?
• What percentage of the total cost will I pay for common services and diagnostic procedures such as X-rays or blood tests?
• If I get extremely sick, how much freedom does my doctor have in coordinating care, and can I see any specialists I want?
• How much will the plan pay for generic and brand-name prescription drugs?
• Can I increase my deductible and pay lower premiums?
• What’s the yearly out-of-pocket limit? (A typical figure is $2,000…don’t let them gouge you!)
• What’s the maximum lifetime benefit? (It should be at least $5 million -- don’t let them be stingy!)
• What is the coverage for mental health?
• What’s the coverage for alternative therapies, such as chiropractic visits and acupuncture?
• Will follow-up care, such as nursing-home or home-health care, be covered?
• If I have a serious medical problem, will the plan provide someone to oversee care and make sure my needs are met?
• Which specific conditions or injuries does the plan deem as emergencies requiring urgent care?
• If I’m in a foreign country and have an emergency, will this plan pay to evacuate me at my request? (This one isn’t a must, but it’s a nice bonus -- plus, it can’t hurt to mention that you’re accustomed to flying first class.)

Based on the answers to those questions and how they compare to your needs, you should be able to find a plan that fits you as well as Cinderella’s glass slipper fits her.

To determine which heath plan you need, decide what you want and need most in the coverage. Which services you need also determines which plan you choose, so make sure the plan covers the services you will most likely use. If you're not interested in certain benefits, you can decline that coverage and save money on your premium.