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- If your employer offers a choice of health plans, compare your options. Each year during open enrollment, carefully compare all your plan options so you can choose the coverage that’s best for you. Plans often change from year to year, so always take a fresh look each enrollment period.
- Do the math when comparing your options and take advantage of "modeling tools" offered by your employer. When comparing options it comes down to this: are you willing to pay greater out-of-pocket costs if and when you need care, in exchange for lower monthly paycheck contributions? Think about the health care expenses you anticipate for the coming year and then do the math for each option. Which plan saves you the most money? Online modeling tools available through many employers make it easy by doing the math for you. (Go to Learn More for a comparison worksheet.)
- If you or a family member take prescription drugs, look carefully at the prescription drug coverage offered by the various plans. Different prescription drug plans cover different drugs at different cost-sharing levels. You can save money by choosing a plan that covers the drugs you take at a higher level.
- The plan with the highest premium contribution isn’t always the best. A higher- deductible plan might actually cost less each year. Many people choose the highest-contribution plan, thinking it will save them money in the long-run. But if you are relatively healthy, a plan with a higher deductible could end up saving you hundreds of dollars each year. Sometimes higher-deductible plans are even a better bargain for heavier users of health care, particularly if combined with an FSA, HRA or HSA. (See next tip.)
- Take advantage of tax-free health care accounts that can be used in tandem with your plan. If you are eligible to participate in a flexible spending accounts (FSA), health reimbursement accounts (HRAs) or health savings accounts (HSAs), take advantage of these tax-free accounts to keep more money in your wallet. (See the Learn More section for more on these accounts.)
- If you choose a higher deductible plan, sock away some of the money you’ll save in premium contributions... just in case. No one can predict for certain whether a serious injury or illness will strike. So if you choose a higher-deductible plan, set aside the money you’ll save in lower contributions as a "buffer" in case you have unexpected medical expenses. If you end up staying healthy, you’ll have that much more set aside in savings! Consider a Health Savings Account (if your high deductible plan qualifies), which lets you set aside tax-free money for health care, and you can even roll it over from year to year.
- If you’re eligible for coverage through your spouse’s employer, compare that coverage to what is available to you. In some cases, it may make sense to waive your company’s coverage and enroll in your spouse’s plan. Keep in mind not all employers allow spouses who work elsewhere to participate in their plans. Also find out whether your employer will allow you to rejoin your plan during a later enrollment period.
- Keep track of your annual medical costs to help you estimate future costs more accurately. This information will be helpful in "doing the math" when comparing your options during annual enrollment.
- Establish a relationship with a primary care physician (PCP). It’s essential to your long-term well-being to have a PCP who knows your medical history and can work closely with you to maintain your health. Your PCP can help guide you when a health problem arises or when you need specialty care. Select a PCP for each member of your family and keep him or her up-to-date on any care or medications you receive from other providers. Choose your PCP when you’re healthy, so you’ll have someone to call when you are sick. (It drives up health care costs when people go to the emergency room when a health problem arises - the most expensive place to be treated - because they don’t have a family doctor to call.)
- Be honest! Your health (and life) could depend on it. Don’t let pride or embarrassment keep you from being truthful with your doctor about your drinking, eating or smoking habits. Your doctor must know these things in order to treat you appropriately. And be sure to tell your doctor about any drugs (prescription or otherwise) or supplements you’re taking. If not, he or she might unknowingly prescribe something that interacts with what you’re taking. Drug interactions can be harmful or even fatal, so don’t hold back.
- Make sure your doctor is a good fit with your needs. Choose a PCP who knows and understands the health issues that are important to you. For example, if you are committed to losing weight through good nutrition, select a PCP who’s knowledgeable in this area.
- Many routine ailments can be treated effectively - and for less - by a nurse practitioner or physicians’ assistant. In fact, many health systems now operate walk-in medical clinics and "Quick Care Clinics" where you can receive fast, inexpensive treatment for common problems such as sore throats, bladder infections, conjunctivitis (pink eye), and more. If you use such services, tell your primary care physician on your next visit, so it can be documented in your medical record.
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Health Plan Decision Checklist
Step ONE: Estimate your Health Care Needs
First think about last year’s health care needs. Then, looking ahead, consider whether you or a covered family member will need. For example
- Routine physicals?
- Preventive screenings, like mammograms or prostate screenings
- Frequent office visits or tests for a chronic condition?
- Surgery or other procedure?
- Prescription drugs?
- Prenatal/maternity care?
- Medical equipment or supplies, such as nebulizer machines for asthma?
- Treatment for mental health/substance abuse?
- Physical, speech or rehabilitation therapy?
- Hospice or home health services?
- Other specialized treatment?
- Vision care
- Dental care
Why it matters: To find the best plan value, you must compare how each plan pays benefits for the service you’re likely to need.
Step TWO: Estimate what you’ll pay under each plan option
Premium contribution: The amount deducted from your pay to be covered under the plan, whether you use the benefits or not. To figure your premium on an annual basis, multiply your monthly contribution by 12, or your per-paycheck contribution by the number of pay periods in a year.
Deductible: The amount (if any) you must pay for health care services each year before the plan begins paying. Note: As a result of the Affordable Care Act deductibles are waived for preventive care, prescription drugs, etc.
Coinsurance: The percentage of covered charges that you are responsible for paying – 10, 20%, 20% etc. The remainder is generally paid by the plan.
Copayment (or copay): Some plans require you to pay a flat-dollar amount for each office visit, prescription drug, or emergency room visit. Check your plan.
Why it matters: This is your money!
If you are eligible for coverage under your spouse’s plan, consider that plan, too, when comparing costs. Not all employers allow working spouses to enroll, so review your spouse’s enrollment materials carefully for eligibility.
Step THREE: Check other key plan features.
Choice of providers: Many plans, such as PPOs, pay higher benefits when you use in-network doctors, hospitals, labs and other facilities. Some plans, such as HMOs, pay benefits only when you use in-network providers.
Plan limits: Some plans will cover only a certain number of therapy visits, chiropractic visits, detox treatments, fertility treatments, etc. in any one year, or in a person’s lifetime.
Exclusions: Expenses for which the plan pays no benefits at all. For instance, experimental treatments are excluded under many plans.
Why it matters: These features are part of what determines which plan is the best fit for your needs.
Step FOUR: Ready to do the math?
The health plan carrier(s) or your employer’s enrollment website may offer an online tool to estimate your total costs under each plan option, so you find the best value. If not, gather your enrollment materials and use this online cost estimator.
Choosing the Right Doctor
Types of Primary Care Providers (PCPs)
A different PCP may be most appropriate for each family member.
TYPE 1: Doctor/Physician (MD, DO)
- Went to medical school and trained in general medicine and/or a specialty.
- Primary care physicians include:
- Family Practice (FP): cares for all ages from birth through old age. May also serve as OB in some practices
- Internal Medicine (IM): cares for adults and sometimes older adolescents.
- Pediatrics: cares for children from birth to early adulthood
- Gynecology (GYN): Cares for women from adolescence through old age. Focuses on women’s health issues.
- Obstetrics/Gynecology (OB/GYN): Cares for women from adolescence through old age. Focuses on women’s health issues including pregnancy.
TYPE 2: Nurse Practitioner (NP)
- Advanced practice nurse with Master’s-level training and additional clinical work in order to provide primary care services.
- Can diagnose and, in most states, prescribe medication.
TYPE 3: Physician’s Assistant (PA)
- Went to additional school and clinical work in order to provide primary care services with an MD.
- Can diagnose and, in most states, prescribe medication when co-signed by an MD.
Things to Consider When Choosing a Doctor
Look at the facts. Find out whether the doctor is board certified in areas relevant to your care. If you’re planning to have a procedure, find out how many such procedures the doctor has performed.
Get references. Ask family, friends, and other doctors that you trust for their recommendations. Be aware that most doctors are expected to refer to others within the same network, so you may have to dig for truly unbiased recommendations.
Consider the doctor’s “fit” with your priorities. For example, if you want to focus on managing your health through better nutrition, look for a doctor who shares this focus. Or if you’re concerned about staying active in sports through mid-life, ask how the doctor addresses these issues.
Trust your feelings. A successful doctor-patient relationship requires that you feel you can communicate openly with this person, and feel that he or she listens and understands you.
FSA vs. HSA vs. HRA
As mentioned above, if your employer offers an FSA, HSA and/or HRA, you should consider opening an account and contributing to it. You can contribute on a pre-tax basis to help you pay for out-of-pocket costs not paid for by your insurance company. Below is a table showing the differences between these accounts and their benefits.
|FSA (Flexible Spending Account)||HSA (Health Spending Account)||HRA (Health Reimbursement Account)|
|Who contributes to it?||Employee||Employee and/or employer||Employer only|
|Who owns it?||Employee||Employee||Employer|
|Is it portable if you leave your current employer?||No||Yes||No|
|Does unused balance carry over after year-end?||No||Yes||Possibly, at employer’s discretion; maximum limits may apply.|
|Is the account invested?||No||Yes, although a minimum balance may be required; the investment options available vary by financial institution.||No|
|Are there any service or maintenance fees on the account?||None to employee (employer pays).||Yes. Typically the employer pays the fees as long as you are employed there.||None to employee (employer pays).|
|What are the tax benefits?||Contributions are tax-free, which reduces your taxable income.||Contributions and earnings may be tax-free, which reduces your taxable income.||Contributions are tax-free.|
|Can it be used for anything other than eligible health care expenses?||No||Yes, but if withdrawn for non-approved expenses, the money is subject to income taxes and possibly a 10% penalty.||No|
What Happens If You Go Out of Network
Some plans pay no benefits if you use a doctor or hospital outside the preferred provider network, while others pay reduced benefits for out-of-network care. The following is based on typical plans. Your plan may be different. To find out if a provider is in-network, call the number on your health plan ID card or visit the plan website.
If Your Plan Pays Reduced Benefits for Out-of-Network Care…
- You’ll probably have to meet a separate deductible before benefits are payable for out-of-network care. There may be exceptions in a true medical emergency.
- An out-of-network provider’s charges are almost always higher than in-network, since there is no discount arrangement.
- Since out-of-network benefits paid by your plan are lower, you’ll pay a higher percentage of those already-higher charges. There may be exceptions in a true medical emergency.
- In addition, you may have to pay any charges in excess of the usual and customary (U&C) or reasonable and customary (R&C) amount. These are the amounts your plan determines to be typical and/or acceptable, based on what providers in a given geographic area usually charge. Some providers charge more than the U&C or R&C amount, others charge less. If you go out-of-network and face excess charges, you may be able to negotiate with your provider to reduce your balance due.
- Amounts you pay for out-of-network care usually don’t count toward your in-network deductible or out-of-pocket maximum.
- Amounts you pay for out-of-network care can be reimbursed from an FSA (flexible spending account) or HSA (health savings account).
- Some doctors who practice at in-network hospitals may be out-of-network providers. For example, the radiologist or pathologist may be independent of the hospital and bill you separately. Just because you are at an in-network facility doesn’t guarantee all doctors working there are in-network. If you charged higher, out-of-network rates, contact your benefits representative. In some cases - but not always - they may be able to negotiate on your behalf.
- Even at an in-network office visit, the doctor may use an out-of-network lab. Ask your doctor which lab service he or she uses, so you can call your plan and find out whether it’s in-network. If it isn’t, ask your doctor if you can have a prescription for the needed lab tests, which you can then take to an in-network lab.
If Your Plan Pays No Benefits for Out-of-Network Care...
- You are responsible for paying the full charge. There may be exceptions in a true medical emergency.
- Amounts you pay for out-of-network care don’t count toward your deductible or out-of-pocket maximum.
- Amounts you pay for out-of-network care can be reimbursed from an FSA (flexible spending account) or HSA (health savings account).
More Resources on other topics
Prices at Wisconsin hospitals
- Wisconsin Hospital Association PricePoint facility-specific info on services and charges
- myHealthcare Cost Estimator UnitedHealthcare members can also call a customer service representative for help at 800-752-1816
Health care quality ratings
- Wisconsin Hospital Association CheckPoint
- Joint Commission Quality and Safety Ratings
- The Leapfrog Group hospital safety ratings
- Wisconsin Collaborative for Healthcare Quality
- Wisconsin Health Information Organization
Health risk assessment
- How's Your Health? 10 minute questionnaire gives you health report, forms for you and your doctor, and other choices. (Select city/region on right-hand side)
- UnitedHealthcare Need to register first with myUHC. It's easy.
- NIH Estimate: Your 10-year Risk of Heart Attack
Why are health care costs rising?
In simplest terms, spending on health care is the product of two factors: price and utilization.
- Prices charged by hospitals, physicians, drug companies and other health care providers have risen dramatically – more than the cost of goods and services in general (inflation).
- Utilization of health care services is up. Despite rising prices, demand for services remains high. More of us are using health care services more often, for more conditions – including some that were not even treated in the past.
Why are medical prices going up, and why are we using more care? Here’s where things get complicated. Experts differ in their conclusions about what – or who – is most to blame, but there’s widespread agreement that certain cost drivers are at work.
Key Cost Drivers
Americans’ lifestyle choices are partly to blame. Unhealthy eating, lack of exercise, smoking, not getting enough sleep, alcohol abuse all put us at higher risk for a host of costly illnesses including heart disease, diabetes, cancer, arthritis and more. Obesity rates in adults and children, while showing signs recently of leveling off, still remain high and suggest health care costs will continue their upward climb. In 2011-2012 approximately 17% or 12.7 million children and teens in the U.S. were obese. Extra pounds put children at an increased risk of developing type 2 diabetes, high cholesterol, heart disease and other expensive health problems for their lifetime. (Source: Journal of the American Medical Association, February 26, 2014, Vol. 311, No. 8.)
Advances in medical technology have led to amazing breakthrough treatments. The research and development costs behind these new technologies must be recovered somewhere – typically through the general cost of medical goods and services. And we’re all paying the high price. Still, Americans want the latest treatment at their disposal, whether it means an expensive bone marrow transplant that may be yet unproven as treatment, or a heart bypass operation at age 85. Our society’s devotion to technological discoveries ensures that costs will continue to rise. No matter what employers do to manage costs, the impact of technology on spending will continue.
Prescription drug costs are rising even faster than medical care overall. Some of the most exciting – and most expensive – developments in medical care involve prescription drugs, specifically specialty drugs. Specialty drugs now account for approximately 20-25 percent of pharmacy spending and the cost of these drugs is expected to quadruple between 2012 and 2020.
Many claim that direct-to-consumer drug ads are prompting patients to request the newest (most expensive) brand-name drug, even when a generic or over-the-counter drug may work just as well. Another concern is that drug ads rarely mention the lifestyle changes or other, non-drug solutions, which are often just as important as drug therapy in improving outcomes. For example, a patient may resist when his physician insists on discussing a low-fat diet, stress management, or allergen avoidance rather than writing a prescription.
Whatever the reason, employees’ usage of prescription drugs, and the cost of those drugs, has significantly increased recent years and is expected to continue rising.
Did you know?
The U.S. and New Zealand are the only countries that allow direct-to-consumer drug advertising that includes product claims.
Source:Abel GA, Penson RT, Joffe S, et al. Direct-to-consumer advertising in oncology. Oncologist. 2006;11(2):217–226
An aging population needs more care. In 2010, there were 40.3 million people aged 65 and older, 12 times the number in 1900. By the year 2030, the older population will number approximately 73 million.
Source: U.S. Census Bureau, report issue June 2014.
What’s the significance of these statistics? Often, as people age, health problems increase. There are more people getting treatment for the types of one-time problems that accompany middle age, such as gallbladder surgery. Just as important, more people now need ongoing care for the types of chronic conditions that may develop with age, such as back problems or adult-onset diabetes. Often, that treatment includes expensive prescription drugs.
The costs associated with older people will not diminish anytime soon. Today’s youngest Baby Boomers will still be in the workforce 15 years from now. As a demographic group, their health costs will balloon as they age and use medicine to live long, active lives. Advances in health care are part of the reason we’re living longer, which in turn is driving our national health care spending even higher.
Did you know?
Approximately one-third of health care treatments, costing $750 billion annually, are unnecessary. Millions of patients receive unnecessary treatments each year, leading to complications, reduced productivity, and significantly higher costs.
Source: Institute of Medicine Report, September 2012.
Consolidation in the health care marketplace means less competition. That gives employers less leverage to negotiate favorable pricing. As a result of consolidation, many health care systems have transitioned services from a not-for-profit to for-profit status, adding the cost of “profit” to medical charges. In addition, there continues to be a great deal of opportunity to streamline the wide range of administrative processes used today in order to eliminate waste from the system.
Governmental factors also play a role in health care cost inflation. Hospitals and doctors receive limited reimbursement from Medicare and Medicaid for patients in those systems. To keep operating at a profit, they must recover those “losses” through the prices they charge commercially insured patients, most of whom have coverage from their employers. Ultimately, it’s the employer and covered employees who end up footing the bill for low reimbursement levels by Medicare and Medicaid and the uninsured.
Additional Consumer Resources