Health insurance is like marriage: Find the right partner,
and you'll have support for as long you both shall live -- or until you
change jobs. But choose in haste, and you may repent at leisure, says Cathy
Dunham, president of the Boston-based Access Project, a nonprofit health
The key is to ask lots of questions, but many new employees pick insurance
plans with less thought than they give to choosing a salad dressing, agrees
Beth Boden, a principal of the human resources consulting firm Hewitt
Associates in Lincolnshire, Ill. "When you buy a car, you think about how
many passengers you'll carry and whether you take home $250 in groceries every
week," she says. "It's the same with insurance: Think about how you use
health care and anticipate your needs."
Since Jan. 1, 2006, a prescription drug plan -- also called Medicare Part D -- has been available to people with Medicare. This gives you some insurance coverage for brand name and generic prescription drugs. Medicare works with insurers and other private companies to offer a number of different plans.
You have quite a few options. You can:
Buy a plan that offers the drug benefit alone.
Choose a Medicare Advantage plan that has prescription drug benefits.
Keep an existing Medigap plan...
If you're young and healthy and don't fly trapezes for a living, a health
plan with lower premiums and higher deductibles could be right for you, Boden
says. Pay less up front, more when you need medical care. In the meantime, you
can stash the money you save in a tax-exempt health savings account (HSA) for a
medical rainy day. But be sure you understand how HSAs and high-deductible
plans work, and don't underestimate the costs of care. You may think a broken
arm will cost $500 to $700 tops, when in fact the expense may be upward of
$4,000. That means you'll be paying huge out-of-pocket charges before insurance
kicks in, says Cheryl Fish-Parcham, deputy director for health policy for
Families USA, a Washington, D.C.-based advocacy group.
Questions to Ask About Health Insurance
What do you need to know when considering a new health plan? Scope out the
answers to these questions, says the U.S. Agency for Healthcare Research and
How much coverage can you afford? Consider premiums (the monthly bite
out of your paycheck), co-pays (how much you pay for each office visit), and
deductibles (what you must shell out before your insurance takes over).
What do you need? Are physicals covered? Screenings? (And if so, how
often?) How about childhood vaccinations, basic dental care, or eyeglasses? Will
it pay for orthopaedic care, acupuncture, or a session with
a chiropractor? If you have a chronic disease, is there a lifetime cap on
coverage? If you need heart bypass surgery, for
example, it could cost nearly $54,000 -- which, if your lifetime cap is
$500,000, would be more than one-tenth of the medical cost your insurer would
How about emergencies? If you fall sick while traveling, will your
emergency room care or visit to a local doctor be covered? How about ambulance
rides or help getting home if you're disabled?
Are healthy behaviors rewarded? Some plans give discount memberships
to health clubs, weight loss incentives, or free
The best advice, says Dunham, is don't get sick. Barring that, make sure
your health insurance company will stick with you for better or for worse, in
sickness and in health.