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HOW TO CHOOSE A MANAGED CARE PLAN
What Should I Look for when Selecting a Health Plan?
Not everyone has a choice of health plans. However, if you are offered a choice of different health plans you may want to consider the following factors:
- Health Care Providers: Find out if your physician is part of the HMO or managed care network. You should also check to see what specialists, hospitals, specialized treatment centers and other practitioners are included in the network. This is especially important if you have chronic or special health problems. For example, if you have a child with special health needs you may be interested in finding which pediatricians are included in the network. You may also want to know whether the provider network includes pediatric specialists who can address your child’s health condition. If you want to continue your care with a provider who is not in the network, you may want to consider enrolling in a PPO or a POS if given that choice.
- Services: Check to see what services are covered or excluded under the plan. You will be given a Summary of Benefits which summarizes the covered services. If you have a special health need, ask to see the Evidence of Coverage which lists the covered and excluded services in more detail. It also lists any limitations in services. For example, many plans limit the number of physical or occupational therapy sessions, or how often a patient can have durable medical equipment replaced. Check the Evidence of Coverage for more specific information about the limitations in covered services. Also check to see where the services are offered and whether they are available in your area of the state. If you have a choice of plans, you may want to talk with your provider to determine which service package best meets your needs.
- Treatment of Certain Health Conditions: If you have special health needs, you may want to find out how the HMO or insurance company typically treats other people with the same health condition. New state laws give you a right to request certain information from an HMO or insurer before you choose to join. You can ask the HMO or other managed care company for:
- Clinical review criteria: The criteria, guidelines or protocols the health plan uses in deciding what types of services or treatments are appropriate given the symptoms and diagnosis. For example, you might want to find out what services the HMO would authorize to treat members with asthma, diabetes, congestive heart failure, sickle cell anemia, inflammatory bowel disease, infertility, autism or severe mental illness.
- Referrals: You should check the HMO’s prior authorization and referral process, especially if you have a health condition that requires you to see your specialist frequently. Some HMOs may only authorize referrals to specialists for a limited number of visits, with a requirement that you obtain your primary care provider’s (PCP’s) authorization for additional visits. Other HMOs may give standing referrals which allow you to see your specialist for the full course of treatment. Beginning January 1, 2000, all HMOs must have procedures to allow standing referrals for certain people with chronic or disabling health conditions. You may also want to check whether the HMO will let you use your specialist as your PCP. For example, you may want to have your specialist serve as your PCP, if you have received a transplant, have sickle cell anemia, HIV or kidney failure (End Stage Renal Disease).
- Centers of Excellence: Some health plans contract with Centers of Excellence for certain services such as transplants. You may be required to travel to other cities or states to obtain those services. It is important to find out where the services are provided, as well as whether the health plan will pay for transportation and lodging costs if the Center is located outside your immediate area. Also check whether the plan will pay the transportation and lodging costs of the parent if a child is required to travel outside of the service area for care.
- Case management Protocol: You may want to see if the HMO has someone who can help you or your family member coordinate all the needed health care services. It is important to realize that a health plan’s case manager is not necessarily the same as a patient advocate. A case manager who is employed by the health plan may help you obtain and coordinate health care services, but may also have a responsibility to the HMO to try to reduce health care costs.
- Formulary: Usually, there are several different drugs that could be used to treat a specific illness, such as asthma, depression, high blood pressure, high cholesterol, or ulcers. Sometimes, health plans limit their coverage of drugs for an illness. Ask your health plan if your specific medication is covered on their formulary. If it is not, talk with your provider to see whether another medication that is covered will work just as well as the one that is not on the formulary. In addition, find out whether the health plan has a process to obtain prescription drugs that are not on the formulary. Beginning January 1, 2000, North Carolina law will require all health plans to have a process to cover drugs that are not on their formularies. Your physician will need to explain to your plan why the drug on the formulary is not adequate to treat your health care need.
- Experimental or Investigational Treatments: Most health plans will not cover investigational or experimental treatments. These treatments include services, drugs or procedures that are still being tested to determine their efficacy as part of a clinical trial and have not yet been approved by the Food and Drug Administration (FDA) for use in the general public. However, people who are covered under the State Employees Health Plan, or an HMO that contracts with the state, have better access to clinical trials. These plans must pay for participation in clinical trials if the medical condition is life-threatening, the investigational treatment is superior to other available treatments or the investigational treatment is the only treatment currently available for the condition.
- Quality: There are many different ways to judge the quality of health plans. Some of the factors to look at include:
- Costs: Find out how much you will have to pay for care from the different health plans. To do this, look at the monthly premiums and out-of-pocket costs in the form of deductibles, co-insurance or copayments, covered and excluded services, and annual or lifetime limits. An HMO with a higher monthly premium may cost less money on a yearly basis after considering all costs. However, this depends on the types of services you need and how often you need them. It is important to evaluate the costs of each plan separately. You should also find out if both plans cover the same services. If the same services are not covered in both plans, you may have to pay for some services out-of-pocket.
Example A
Mary Jones is given a choice to enroll in Insurance Company A or HMO B. Insurance Company A charges a $185 a month in premiums. The plan has a $250 deductible, after which it will pay 80% of all other health care services. HMO B charges $200 a month in premiums, but only requires a $10 copayment per visit to the physician. Mary’s annual health care costs will depend on her use of health services and the costs incurred. Even though Insurance Company A’s premiums are less expensive, Mary may spend less money on a yearly basis with the HMO if she needs frequent visits to the physician. For example, it would be less expensive for Mary to join the HMO, if she sees the physician three times a year, assuming an average cost of $125 a visit. In this example, Mary would have to pay $2,495 per year for Insurance Company A, but only $2,430 for HMO Company B. |
|
Insurance Co. A
(fee-for-service) |
HMO B |
| Premiums |
$2,220
($185 premium for 12 months) |
$2,400
($200 premium for 12 months) |
| Deductible |
$250 |
$0 |
| Physician visits |
$25
Once she meets her deductible, Mary must pay 20% of the remaining $125 of the doctor's cost and the insurance company will pay the remaining 80% |
$30
Mary pays a $10 copayment for each of her 3 visits |
| Total |
$2,495 |
$2,430 |
How Do I Know What Services My Plan Will Cover?
Your Evidence of Coverage (member handbook) describes the services that are covered and excluded in your plan. You should receive a copy of the Evidence of Coverage when you enroll or your employer enrolls you in the HMO. The Evidence of Coverage includes information on:
- Covered services, including any limitations;
- Excluded services;
- Cost Sharing or coverage differences for in- and out-of-network services;
- Total payment for health services that the member must pay;
- Reference information available to members and prospective members upon request;
- Definition of medical necessity;
- How to request pre-authorization for services and the toll-free number to call for pre-authorization;
- Coverage that is available for out-of-network services;
- The health plan’s method for resolving member complaints;
- Appeal and grievance procedures; and
- Reasons, if any, that an HMO can terminate a member’s enrollment.
Look at the sections in your Evidence of Coverage that describe the services covered as well as limitations or exclusions. Most plans will not cover experimental services or long-term institutional care. In addition, many plans limit physical, speech or occupational therapy services and durable medical equipment, and some limit mental health or substance abuse coverage.
Note: It is very important to read the Evidence of Coverage carefully. Your HMO is required to send you another copy of your Evidence of Coverage if you cannot find your original copy.
What If I Have a Pre-Existing Condition?
Under certain circumstances, health plans are allowed to limit coverage of people with pre-existing conditions. Pre-existing conditions are mental or physical conditions for which you sought medical advice, care or treatment within six months prior to your enrollment. Health plans, both HMOs and insurance companies, can limit coverage for some people for up to 12 months. With certain exceptions, a person who enrolls late—after the normal enrollment period—can be excluded from coverage for pre-existing conditions for up to 18 months. However, individuals who enroll late because they lost other health insurance coverage are generally not considered late members. Therefore, they can only be subject to a maximum of 12 months pre-existing condition limitation.
A patient who has a pre-existing condition may be excluded from coverage for the services needed to treat that condition. The health plan will cover other services that are unrelated to the pre-existing condition. For example, if a person has cancer or a heart condition, the health plan can exclude coverage for those conditions, but will still be required to pay for other health services unrelated to the heart condition or cancer. The reason that health plans are allowed to limit coverage for pre-existing conditions is to discourage individuals from waiting until they are sick before purchasing health insurance coverage.
Once you meet the 12- or 18-month pre-existing condition limitation period or are enrolled in a health plan for at least 12 months, you are given additional protections. You can not be subject to a pre-existing coverage limitation if you later develop health problems. In addition, you will not be subject to a pre-existing coverage limitation if you change health plans and enroll in your new plan within 63 days of ending your prior health insurance coverage. If you met part of an exclusionary period, you must be given credit for that time when enrolling in a new health plan. For example, if you received health insurance through ABC insurance company, and met six months of a 12-month exclusionary period, you must be given credit for that six months if you enroll in XYZ insurance company within 63 days of leaving ABC.
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