It’s open enrollment season for health insurance.
The phrase sounds so inviting, yet it can be an anxiety-filled event – almost making us need some mental health therapy just to get through it! And while there are many articles and resources available for patients that purchase insurance through an Affordable Care Act exchange, many patients with employer-provided insurance coverage are unclear about how open enrollment affects them.
In 2016, 157 million Americans were covered by employer-provided insurance plans. And many with health benefits provided through an employer – are still struggling to access the treatments we need, when we need it!
Here are a few things that every patient with employer-provided insurance should know during open enrollment.
Employer-Provided Insurance: Funding the Benefit
Not all employers offer the same health insurance. First, you need to identify whether your employer-provided health coverage is either fully-insured or self-insured.
- Fully-insured health plans are those in which the plan takes on the responsiblities and risks for paying an individual’s claims.
- Self-insured or self-funded plans put the risks and responsiblities of paying claims directly on the employer.
Fewer and fewer companies are opting for fully insured plans. If the company is small, it may be the best approach because the health plan continues to manage the financial risk. If you have a few very sick newborns, or employees with high cost conditions, such as hemophilia, those costs are spread out across a health plan with thousands of people and not just one employer.
Over the last decade, more and more large employers have decided to take on increased risk and do it themselves with self-funded plans. Self-funded plans are also known as “Administrative Services Only (ASO),” or “Administrative Service Contract (ASC).” Regardless of the name, the principle is the same: large companies managing the health benefits themselves.
Types of Employer-Provided Insurance Plans
Many employers are offering their employees Consumer Directed Health Plans, which goes by the acronym CDHP.
You might say that Consumer Directed Health Plans are really the “I Pay for Everything” health plan. That’s because these high deductible plans require patients to pay full-price for everything until you hit the deductible. After that, the health plan kicks in. Usually, patients still pay a deductible of between 20 to 30 percent — with the insurance paying the rest.
Again, as more insurance companies shift to self-insured plans, it alters our concept of health insurance. In essence, your employer has taken on the role of the traditional health insurance company with the insurer acting as a Third Party Administrator to simply process and pay the bills. Most HR departments in these large companies rely on the expertise of health plans, but the final decision over coverage rests with your company.
Employer-Provided Insurance: Benefit Design
Selecting your specific health plan can be overwhelming, but it’s critical to review each plan’s benefit design.
Start by calculating how much you and your family spent last year on health care. Maybe even the last two years. Next, identify any new potential health care needs, including an upcoming surgery, labor & delivery, behavioral health services, and pharmaceutical benefits. This process can take a few hours, but it could save you thousands, or even tens of thousands of dollars later.
Use any online calculators that are designed to help you anticipate costs under each plan option. These tools use sophisticated algorithms to calculate costs based on predictive models incorporating your age, risk, prior costs, health status, and experience based on claims data from millions of other patients.
Employer-Provided Insurance: Provider Selection
Finally, every patient with an employer-provided insurance plan should consider a plan’s selection of providers. Is a doctor or hospital in-network or out-of-network?
Many patients look for a plan that has their doctor in-network. Other patients may be open to finding a new doctor as a way to lower their health care costs. Decide what is important to you and select a plan accordingly.
Beware that suprise billing for out-of-network charges is a common problem. If you have a preferred doctor or specialist, take the time to review whether he or she is covered by your plan. Today, many doctors prefer to operate independent of a plan in order to deliberately remain out-of-network. As patients, it’s critical to select to the right plan that will get you access to the right care.