When it comes to health insurance, do your research

When it comes to health insurance, do your research

By Grace-Marie Turner, President, Galen Institute
(Image/Stock Image)

To the editor:

The airwaves are filled with advertisements encouraging people to enroll in the new exchange marketplaces for health coverage, but surveys show that consumers are as confused as ever about what’s required of them.

Most people have heard about some of the early provisions of the Affordable Care Act, such as letting 26-year-olds stay on their parents’ policies, free preventive care and coverage for pre-existing conditions. But a Kaiser Family Foundation survey found that more than half of Americans say they don’t understand how the health law will affect them or their families. Well more than half of the uninsured don’t know they must obtain health insurance by January 1 or pay a fine.

There is danger ahead for those who don’t understand the law, especially the uninsured. For them, the three road signs described below may help.

1) Navigators: The law will subsidize health insurance for millions of Americans, but people must apply for the coverage. Tens of thousands of navigators are being hired, generally by nonprofit organizations, to help people apply.

Navigators are not licensed, and while they do receive some training, they do not go through the extensive process of certification and background checks required of insurance agents and brokers. Further, not everyone who says they are a navigator may actually be one.

They will be gathering personal information, such as your Social Security number, address, income, employer’s name and address, names and birthdates of your children, and health habits to find out if you qualify for the subsidies.

Giving this information to strangers presents a risk for identity theft. Thirteen state attorney generals have expressed deep concerns about the security of the information. The risks of potential identity theft are very real. Be very careful about giving out this information.

2) Beware of mandates: The law contains an individual mandate that requires virtually everyone to have health insurance. The individual mandate is aimed primarily at uninsured Americans who must obtain government-approved health insurance or pay a fine.

This mandate takes effect January 1. The penalty for not complying in the first year will be $95. The penalty will increase to $325 in 2015 and $695 in 2016. The penalties scale up to as much as 2.5 percent of income after that.

The uninsured are least likely to know they will be subject to the mandate, according to recent surveys.

3) Watch for costs: It is very important to properly state your income on the application and understand the full costs of the health insurance plans you are choosing to adequately prepare for the new expenses you will face.

The plans offered through the health exchange marketplaces will not be free. Almost all consumers will be required to pay monthly premiums and deductibles as well as co-payments for doctor visits. The amount depends upon the plan you select and your income.

If you do not pay your premiums, your policy will be canceled and you will be penalized. Further, if you understate your income and get a larger subsidy than you are entitled to receive, you will be required to repay the surplus — possibly thousands of dollars.

To be a wise consumer, you should protect your personal information, understand your choices when it comes to purchasing insurance and educate yourself so you are fully aware of how much your new insurance plan is going to cost you.