How to shop for health care insurance

Buying health insurance is no one's idea of fun.

But for many folks who have lost a job, just graduated from college or maxed out their COBRA, it's a necessity.

One of those is 60-year-old Nancy Thompson of Camino, Calif., who lost her shipping office job at Sierra Pacific's mill last year. This month, the COBRA health coverage from her former employer ran out.

Determined to stay covered, she went shopping for health insurance - online - and found it an unpleasant experience.

Using one of the many comparison sites for health insurance, she started filling out her online application. "It was overwhelming. There were so many questions and I started feeling uncomfortable," Thompson said. "I didn't even finish filling it out."

That's when the e-mails, phone calls and letters started arriving from brokers or agents eager to sign her up.

Frustrated, she opted to buy a $541-a-month Aetna policy from a Citrus Heights, Calif., insurance broker who came to her home. (Her husband, who is retired, has his own health coverage through Medicare.)

Her experience isn't unique.

"It can be a very onerous process," said Sam Gibbs, senior vice president of eHealthinsurance.com, a Mountain View, Calif.,-based online insurance website. "You have to fill out extensive medical questionnaires about doctor visits, prescriptions. ... It takes some time and throws a lot of people off."

Many individuals qualify for a policy instantly, he said, but for those with complicated medical histories, "it can take weeks to get an answer back."

Despite the difficulties, most people can't risk going without insurance. Here's a rundown on how to look.

TRY THE GROUP

Group plans usually offer the most affordable premiums. Pursue coverage offered by your employer, spouse, college alumni, professional or other membership group, such as AARP.

If your COBRA benefits are expiring, you might consider California's program, Cal-COBRA, which covers individuals who lost their jobs at small companies (up to 19 employees), as well as those who exhausted their federal COBRA benefits. For details, go to www.healthhelp.ca.gov or call (888) 466-2219.

CALL A BROKER

Whether it's done online, by phone or in person with an agent, consumers should do some homework before contacting a broker.

"Before handing over your personal information, it doesn't hurt to spend 45 seconds to check and see if a broker or agent is licensed or in good standing," said Darrel Ng, spokesman for the California Department of Insurance.

To check a California broker's status, go to www.insurance.ca.gov (click on "Consumers") or call (800) 927-HELP.

The Department of Insurance's site also has a handy list of toll-free phone numbers and websites of the nearly 70 health insurance companies licensed in California, ranked by market share. There's also a scorecard to compare quotes from different insurers.

ONLINE SHOPPING

Sites like ehealthinsurance.com or myinsuranceexpert.com let you sort plans by deductible, premium price or other categories.

Pay attention to what's covered. The lowest premium, for instance, may carry a high deductible (the amount you spend out of pocket before insurance starts paying). And it may not include much or any coverage for prescriptions and hospital stays.

When we typed in a price quote for a single, nonsmoking female, age 27, for instance, there were 124 choices, ranging from a $54-per-month Anthem Blue Cross premium ($5,000 deductible and $40 office visits) to a $375-per-month Health Net premium (no deductible and $25 office visits).

But those premium quotes could change once your medical history is factored in.

"If you're young and very healthy, you may get a rate that is less than what's quoted. But if you're older and have medical conditions, you may have a rate that's slightly higher," said Gibbs.

HSA

A Health Savings Account, or HSA, is tied to an insurance plan, where you set aside pre-tax dollars to pay for medical expenses. It's a high-deductible but low-premium plan. Since any unused amount rolls over every year and earns interest, HSAs are considered tax-free savings accounts, similar to an IRA, that can build up toward retirement or future medical bills.

HIGH-RISK POOLS

Starting in September, insurers will no longer be able to deny coverage because of pre-existing conditions. Until then, people with such conditions still have options. California currently covers up to 7,100 individuals and families under the Major Risk Medical Insurance Program, known as "Mister Mip." It's at www.mrmib.ca.gov.

California is setting up a second high-risk pool, funded with $761 million in federal health care overhaul funds. It will cover those who have been denied medical coverage and have been uninsured for at least six months.

"We're going to get it up and running as quickly as we can, because we recognize the need," said Jeanie Esajian, a deputy director with the state Managed Risk Medical Insurance Board.

Premium rates are still under discussion and will vary, depending on age and region. For more details, go to: http://www.hhs.gov/ociio/initiative/hi_risk_pool_facts.html

THE 'BLUE BOOK'

Another alternative is to pay cash and ask for a "fair price" from your doctors or medical providers, using the "Healthcare Blue Book," a medical pricing guide ranging from surgery to dental and eye care procedures.

It's especially helpful for those with high deductibles who are paying out-of-pocket and looking for affordable options. According to the Blue Book, prices quoted are the average amount that providers accept from insurers.

Some providers will discount a price if you ask. Details are at www.healthcarebluebook.com.

Overall, finding health insurance takes some diligence.

Thompson, who still gets one or two e-mails a week from insurers seeking her business, said she feels secure with the $2,500-deductible policy she purchased earlier this month.

"Thank God we've saved and can afford insurance," she said. "But what about the ones who can't?"

DETAILS ON COVERAGE:

The federal Department of Health and Human Services has announced new details about the expanded coverage, part of the Affordable Care Act passed in March. The information is available at the DHHS website: www.hhs.gov.

Among the key points:

- Health insurers aren't yet mandated to cover dependents on a parent's health plan, but those that already do must now make that coverage available up to age 26.

- If you've already "aged out" or graduated from college, you can be reinstated on your parent's health plan as long as you're under age 26.

- You can be covered even if you're married, no longer a student, no longer living at home or no longer a dependent on your parents' tax return. The only exception: Young adults eligible for health care through their job cannot be covered by a parent's health plan, at least until 2014.

- The new provision doesn't officially kick in until Sept. 23, but at least 65 health care companies are offering "stopgap coverage" for young adults starting June 1, in most cases.

- Check with your insurance company to see if it will provide coverage now. If not, watch for the special open enrollment period starting Sept. 23.

- Employers and health care providers are required to provide notice of the open enrollment. Young adults and their parents need not do anything but sign up and pay for this option.

- Premiums are expected to be the same as those of dependent children currently covered by a parent's plan.

- Federal employees, military health plans and Medicare are not included.

(c) 2010, The Sacramento Bee (Sacramento, Calif.).

Distributed by McClatchy-Tribune Information Services.