Insurance Basics
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Examining the health insurance company

Price is only part of the equation when it comes to selecting health insurance. You also want to make sure you have a consumer-friendly health insurance company that makes it easy for you to get the care you need.

Once you've put a price on it, look at how easy or difficult the plan is to use. If there's a list of preferred providers, are your favorite doctors on the list? Which hospitals can you use? How difficult is it to see a specialist or get a second opinion? Would you need a referral? Are prescriptions you regularly use covered? And does the plan include any "extras" that you regularly use, like eye care or chiropractic services?

Pre-existing a must

Fortunately, health care reform has made it easier to answer the big questions surrounding your new health insurance policy.

The Affordable Care Act of 2010 not only made a wide range of preventive care available to insured adults and children without out-of-pocket cost, it also prohibited insurance companies from rescinding coverage if you get sick, eliminated lifetime limits on coverage and restricted annual policy limits until they are outlawed completely in 2014.

Health care reform also prohibits insurers from charging higher rates or denying coverage to those with pre-existing conditions. The prohibition is already in effect for children to age 19. For adults, a special Pre-existing Condition Insurance Plan provides a bridge for uninsured Americans with pre-existing conditions to secure coverage until 2014.

If you're currently insured, pre-existing conditions have to be covered, says Paul Fronstin, director of the health research and education program for the Employee Benefit Research Institute.

"Employers will typically not have these exclusions anyway, because they don't make good sense," he says.

Once you've looked at the plan on paper, you want an idea of what it will be like in action. That's where it pays to check out the health-care company itself.

Check them out

Once you've perused a health plan on paper, you'll want to know how it will work in action. That's where it pays to check out the health insurance company itself.

Start with fellow employees or people you know who are already on the plan. What has been their experience with this insurer?

Next, research online to see what other consumers are saying about the company, its coverage and its service. Call your state insurance department to see if you can get the complaint ratio or any other helpful information.

Finally, check into the company's financial health at any of the following: Standard and Poor's, A.M. Best Company, Moody's Investors Service and Weiss Ratings.

Quality is the first priority

Whatever company you choose, be practical. Look at the quality of care and coverage, not just the bottom-line price. And if a policy doesn't give you enough coverage or you can't meet the deductibles, select another.

Thanks to health care reform, there is a new consumer tool called the "medical loss ratio," or MLR, that measures how much of your premium an insurer spends on your health and how much goes toward their administrative costs and executive bonuses. To find out if a company passed its most recent MLR test, log onto the federal healthcare.gov's company profile site.

The MLR information will also be available at the new state health exchanges, which are scheduled to open in 2014. These one-stop-shopping health insurance markets are designed to help individuals and small businesses easily compare and purchase the affordable plan that best suits their needs.

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