Health Insurance Explained

Open enrollment is your one shot during the year to enroll in a health insurance plan. Unless you switch employers or lose your job, this is the only time to make changes to your benefits provided at work. Choose wisely. You’ll have this plan until your next open enrollment period or until a major qualifying event occurs.

Here’s a quick guide to five things to consider when choosing your health benefits at work.

HSA

If you’re offered a High Deductible Health Plan (HDHP), you can also sign up for a Health Savings Account (HSA). You’ll pay a lower monthly premium, and the HSA allows you to set aside money on a pre-tax basis to pay for qualified medical expenses. The untaxed funds in your HSA can be used to pay for medical expenses before you meet your deductible and can cover other out-of-pocket costs like co-payments. HSA funds can roll over from year to year. HSAs are usually set up through your bank or other financial institution.

FSA: Use It or Lose It

Not to be confused with an HSA, a Flexible Spending Account (FSA) lets you use pre-tax dollars to pay for certain expenses not normally covered by your other benefits, including dependent care, medical deductibles, co-insurance, prescription eyeglasses, non-covered dental expenses and acupuncture. FSAs are “use it or lose it,” so if you contribute more than you need to spend on medical care, you lose any unused funds at the end of the year. Check the IRS website for updated information on FSA contribution limits. Adjustments to your FSA contributions can only be made once a year during open enrollment.

PCP

One of the most used acronyms in healthcare is PCP. It stands for primary care provider, who is your go-to physician for everything from managing a long-term illness to asking routine healthcare questions. Need to pick a new PCP because your insurance plan has changed? Use this list of things to look for to find the physician that’s right for you.

PPO/HMO

Most likely, you’ll have the choice between an HMO or PPO. Health maintenance organizations (HMO) are health plans that arrange healthcare services for its members. You’ll need to choose a primary care provider from within your HMO network. The primary care provider provides routine care and refers you to specialists if you need special care. Also known as a preferred provider organization, a PPO allows you to see any physician, and you do not have to name a primary care provider. Referrals aren’t needed, but you will pay less if you go to providers who are in your PPO network. The plan you choose is a matter of personal preference, but be sure to check with your physicians’ offices to determine which plans they accept.

In-Network vs. Out-of-Network

Your insurance plan has negotiated reduced rates with certain physicians and other healthcare providers. This group is “in network,” and receiving care from these providers can save you out-of-pocket costs. Typically, all you have to pay is your coinsurance or co-pay, along with any deductible. Network physicians will handle any pre-certification your plan requires. If you choose a physician who is out of network, your health plan may pay some of the bill, but less than if you received care from an in-network physician. Read your plan for more details. You can request a list of in-network providers from the Member Services Department at the insurance company.

Once you’ve completed open enrollment, the real work begins: keeping track of your medical expenses. Whenever you receive a healthcare service, your insurance company will send you an Explanation of Benefits (EOB), which outlines the services that were billed by a healthcare provider. It’s different from a billing statement, which can take a few weeks to receive. Confusing? Medical bills can be complex, but these five things will help you better understand your hospital bill.

When it comes to your health, a smartphone is a great way to track your medical needs and healthcare expenses. Your phone can be used for everything from heart rate monitoring to organizing your family’s health. Stay on track with these 8 smart uses for your smartphone.