An ill-fitting health insurance plan can have costly health and financial consequences, and studies show that many Americans lack an understanding of health insurance and how to use it to make beneficial health-care decisions.
“People will come in and think that they have it down, and they really don’t, and then you have people who admittedly just have no idea walking into it,” said Tyler Graff, federally certified marketplace navigator with the Northwest Missouri Area Agency on Aging. “Some individuals we help, before the Affordable Care Act, had not had access to insurance for 20, 25 years or longer. They come in and they don’t know even the simplest thing, like what a deductible is, things that a lot of people take for granted.”
Studies have shown that many people have low health insurance literacy, the ability to find and evaluate information about health plans, determine what plan is best for their needs and how to effectively use the plan once enrolled.
People also often think they know more about health insurance than they actually do, and less than half of people review a plan’s details before signing up for coverage, according to the American Institutes for Research.
“That does hinder their ability to pick a plan because a lot of times all they are seeing is the price of the plan,” Graff said. “They want whatever is cheapest without understanding that plan, if you actually go and use it, is actually going to end up costing you more in the long run.”
Understanding a health insurance policy can help consumers keep their preferred caregivers, reduce unexpected medical costs and best use a policy for their care needs, Graff said.
No matter the insurance plan, he encouraged people to do research and not navigate the process alone, especially if they haven’t had insurance recently or have experienced changes. By reviewing options, he once helped a couple reduce their monthly premium and out-of-pocket medical costs from more than $2,000 to less than $100 a month, Graff said.
“Health insurance is still pretty complicated,” said Sophie Stern, deputy director of the Best Practices Institute at Enroll America. “It is really important that people are aware of the resources that are available to them in the community. We know that in-person help and making sure that people get the help they need is absolutely critical.”
As of 2014, a total of 33 million people didn’t have health insurance, including many non-citizen immigrants, those in the “Medicaid gap” and young adults between the ages of 19 and 34. In 2014, 17.1 percent of all people 19 to 25 years old and 18.2 percent of people 26 to 34 years old were uninsured.
“A lot of people relate health insurance to the elderly or illness,” Graff said. “It can be you are out playing a game of pick-up basketball out at Mo West and you twist your knee. That’s health insurance. That’s something that, at 21, could financially hinder you for the rest of your life. Anything can happen.”
When preparing to select a health insurance plan, Stern recommends people take stock of their individual situation, including medical needs, anticipated procedures or medications and provider preferences, as well as a plan’s premium and out-of-pocket costs. A 2014 American Institutes for Research study found that only 20 percent of people were able to correctly determine how much they owe for a routine doctor’s visit.
“We don’t want people to be surprised when they go to the doctor’s office and have a deductible and co-pay that’s higher than what they were expecting,” she said. “There really are ways to avoid some of those surprises. Do your due diligence during the open enrollment period to make sure you are getting the plan that meets your needs and budget.”
Affordable Care Act open enrollment begins Nov. 1, 2016, and runs through Jan. 31, 2017. Local assistance can be located through getcoveredamerica.org or by contacting the Northwest Missouri Area Agency on Aging at 816-724-3310.
“You are not alone,” Graff said. “Most of your peers are in the same boat as you. They don’t understand this either.”