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Choose health insurance by services needed and cost

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My father once called from his clinic at the state Department of Mental Health in California and complained, "I’m a physician, and I can’t make any sense out of the three choices I’m given for health insurance." We laughed. The choice of health insurance is both crucial and challenging. What’s at stake? Access to quality health services you need and want and the amount you have to pay for care.

For those who work a steady job, 20 or more hours per week, choices will be limited to what the employer offers.

In contrast, contractors or those who are self-employed usually will encounter higher premiums yet with still few options. Carriers are reluctant to enroll individuals or single families because they prefer to spread risk across a large pool.

People with low or no income may apply for government-subsidized programs such as Quest, which includes Aloha Care, and Medicaid now offered through Ohana and Evercare. To qualify is a slow process, and even modest cash flows or assets will make it impossible.

Last week the Hawaii Department of Human Services announced that it will cut 4,500 people from the system due to rising costs. Many of those cut off will simply join the large number of uninsured. When fortunate enough to secure private insurance, it is important to consider the following when making your selection:

Staff model or not: Kaiser, the second-largest carrier in Hawaii, is classic staff model. Kaiser employs its providers. For the most part, income is not dependent on the number of patients seen. For community providers, in contrast, income is based on numbers of patients seen or procedures performed. They usually participate with multiple fee-for-service carriers such as HMSA, UHA and HMAA. Health professionals are trained to do the right thing, and usually do, but there is always a risk in the Kaiser model of not getting all of the care you need and, if treated outside of Kaiser, getting care that you don’t need.

Health maintenance organization (HMO) versus preferred provider (PPO): You will have to make this decision if you join HMSA, for example. Under the HMO program, patients have to select a single primary care physician (PCP). You must see this provider, sometimes called a gatekeeper for any referrals to medical specialists. The premium is somewhat higher for the PPO model, which enables direct access to all participating providers.

Co-payments and deductibles and maximum benefits: Study plan benefits carefully for your different co-payments for various services. Patient responsibility for outpatient visits might be a set amount under one plan but a percentage under another. That percentage will change if you see a provider that is not participating with your carrier. Patient co-pay responsibility might be different for inpatient services or for diagnostics. Some plans offer deductibles of, say, $500. That means you pay the first $500 before your insurance kicks in, but premiums will be less. Finally, check on maximum annual and lifetime benefit limits.

Scope of coverage: Does the plan cover drug, vision and dental? If you are taking medication for a chronic problem, check the specific plans to see whether your medications are on the formulary and what the patient financial responsibility is for each specific prescription you will need under the subject plan.

Stop loss: Most plans will have a ceiling on the total amount out-of-pocket you will be asked to pay each year. After you exceed that amount, the insurance will cover 100 percent of approved service. For people who might need more than one expensive procedure, costs might be less if those procedures are done in the same policy year.

Ira Zunin, M.D., M.P.H., M.B.A., is medical director of Manakai o Malama Integrative Healthcare Group and Rehabilitation Center and CEO of Global Advisory Services Inc. Please submit your questions to

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