Don’t shop from a search engine
If you Google “affordable health insurance,” you’ll see sites that promise instant quotes. Stay away from them. It’s impossible to tell which ones are legit, and you run the risk of getting a call from a telemarketer pushing junk. “Few licensed health insurance companies market to consumers in this way and even fewer sell directly to consumers,” says Mila Kofman, a research professor at the Georgetown University Health Policy Institute and former superintendent of insurance in Maine.
Don’t respond to flyers on telephone poles, faxes, robo-calls, or late-night infomercials
Look up real plans at Healthcare.gov
On this federal website you can search for all legitimate licensed health plans sold to individuals in your state. But you can’t buy a plan directly from the site. (If you live in Massachusetts, the one state that already mandates health insurance for all residents, you can buy directly from its online health exchange, MAHealthConnector.org. As of 2014, all states will have similar exchanges.)
Consult a licensed independent broker
They handle plans from multiple reputable carriers and “know which products are real and which ones are scams,” says Monica Lindeen, Montana’s commissioner of securities and insurance. They can walk you through the plan options and pricing, and may be able to find you coverage even if you have certain pre-existing conditions. Your auto and homeowners insurance broker might also offer health insurance. Or ask friends and relatives for recommendations.
Check with your state insurance department
Consumers who contact us with health insurance questions are rarely aware that health plans sold to individuals are regulated by the states. Most state insurance department websites have a guide that explains which major medical plans are licensed by the state. And 26 states now have federally funded consumer assistance programs. To find yours, search for “consumer health” at Healthcare.gov.
Make sure everything’s covered
Until health reform goes fully into effect in 2014, insurers can sell plans that don’t cover some basic medical services. Many plans don’t cover prescription drugs, or cover only generics. (Generics are a great way to save money, but some costly drugs come only in branded versions.) Some plans sold in New Jersey cover only $500 a year in outpatient diagnostic tests and don’t cover drugs or cancer chemotherapy. Avoid these types of plans, even if you don’t need the services right now. The purpose of health insurance is to protect you if and when you do.
Find out whether your group plan is a mini-med
The government requires all mini-meds with waivers to include a disclaimer that reads something like this one on a Cigna plan: “Your health coverage … does not meet the minimum standards required by the Affordable Care Act.” “If the premium is almost as much as the outpatient benefits, stay away from it,” advises Karen Pollitz, a senior fellow at the Kaiser Family Foundation. “A few of the better plans cover up to $100,000 a year. That’s still not great but may be worth it if you have no alternative.”
Know your COBRA rights
If you leave your job and your workplace has 20 or more employees, the federal COBRA law entitles you and your dependents to stay on your group plan for up to 18 months (or more in certain situations) so long as you pay the full premium yourself, which can be costly. To learn more about COBRA’s provisions, which can be complex, go to the Department of Labor’s website, at www.dol.gov, and type “Cobra” into the search box. Many states have “mini-COBRA” laws protecting employees of smaller companies.
Consider Pre-existing Condition Insurance Plans and high-risk plans
If you have a serious pre-existing condition and can’t find a carrier who will insure you, you are eligible for coverage under the Pre-existing Condition Insurance Plan created by the health reform law. Thanks to federal subsidies, premiums for the plans are comparable to commercial plans sold to healthy people. The catch is that you have to have been uninsured for at least six months to be eligible. Look up your state’s plan at PCIP.gov. Thirty-five states also offer separate high-risk plans for people who don’t want to “go bare” for six months, but premiums tend to be higher. You can find a list of these plans at www.naschip.org/states_pools.htm.
Investigate public programs
If your income is on the low side, your children may be eligible for free or low-cost insurance through your state’s CHIP program, and depending on your state’s eligibility rules, you may be able to get on Medicaid. Contact your state or local social services agency to find out whether you or your children are eligible for coverage.
If you're in the market for health insurance, check out Consumer Reports' buying guide, which features expert advice on choosing and using health insurance.