What is the optimal amount of time to spend on choosing a health insurance plan? Health insurance is complicated, but most people, no matter how well educated, turn out to be bad at making this choice. It’s confusing even for people who understand all the terms, such as deductible and co-pay, according to a report by the Kaiser Family Foundation.
Not surprisingly, most people are reluctant to spend lots of time choosing a healthcare plan. A survey by Aflac found that 57% spent less than 30 minutes on this important decision. Why? It may be because 90% of employees simply stick with what they have, choosing the same plan as they had last year.
However, doing that can be a mistake, as your employer’s offerings—and the plans themselves—may have changed, and you might miss a better choice for you and your family if you simply stick with your old plan.
Key Takeaways
- Choosing a health insurance plan can be daunting, with several options and levels of coverage available.
- Here, we compare Aetna and Cigna preferred provider organization (PPO) plans as an example of what you should look out for when choosing your own health insurance plan.
- A combination of objective factors like a state’s ranking or score, as well as subjective matters like a friend’s recommendations or past experience, should be used.
Investopedia / Ellen Lindner
Cigna vs. Aetna
As examples, we use Aetna and Cigna health insurance preferred provider organization (PPO) plans offered by employers. The details for these companies will vary among employers. But the tips for comparing the plans could help you make your own decisions, whether it’s among either plans offered by your company or policies offered on the individual market through the Affordable Care Act’s (ACA’s) Health Insurance Marketplace/Exchange on HealthCare.gov.
Survey Your Insurance Options
The first step is to look at your choices. You’re likely to have a number of plans from which to choose. For example, employees of the federal government who live in New York have a mind-bending number of plan choices—more than 25. And in many areas of the country, the choices are plentiful at HealthCare.gov.
In either case, it pays to check every year to see if a newly available or expanded plan is offered to you.
Consider the Company
Aetna and Cigna both insure a large number of people and rank among the top 10 for sheer size. While a large health insurance company is not necessarily better, it’s likely that a large one will have a good number of doctors to choose from in your provider network, and that you will also be able to find people you know who have had local experience with the plans that you’re being offered.
Employees who travel or work periodically overseas may find global provider Cigna to be a good fit due to its international medical insurance policies.
One distinction is that Aetna is a U.S.-focused company, offering medical insurance through employers and on the individual market. Cigna is a global provider of health insurance for employers in more than 30 countries, according to its website. If you work abroad or travel a lot, you’ll find that Cigna has a number of international medical insurance policies.
Check How Plans Rank in Your State
Rankings of health insurance plans according to consumer satisfaction and other factors have become easy to access and use. The nonprofit National Committee for Quality Assurance (NCQA) creates detailed quality rankings each year of PPOs and health maintenance organizations (HMOs) available in every state.
If your choice is between Aetna and Cigna PPOs, the rankings for 2019–2020 (the most recent ones available) reveal that both insurance companies are well regarded by consumers overall. Their scores on a scale of one to five are identical in Pennsylvania, at 3.5. But in Vermont, the Cigna plan gets a 3.5 in consumer satisfaction while Aetna gets only a 3.0.
You can dig deeper on each, using the compare tool to focus on plans that you’re considering and see how consumers rate them on matters such as getting care quickly and quality of primary-care doctors.
In Vermont, Aetna rates highly on getting care quickly but falls short on the quality of primary-care doctors. Cigna also rates highly on getting care quickly and a bit better on the quality of primary-care doctors.
Consider What’s Important to Your Family
The details in the rankings may be important. If you’re planning on adding to your family, check the ratings for the company’s prenatal and postpartum care. If someone in your family has asthma, check the plan’s rating for asthma control and asthma drug management.
It may not be possible to tick every box on your family’s list of potential medical needs, but you should try to cover as many as you can.
Ask Around
If you have doctors you like, you’ll want to check with their offices before switching insurance plans. Many doctors and hospitals take multiple plans, so this may not be a problem. If you’re looking for a new doctor, don’t just pick at random from the insurer’s book of practitioners.
Colleagues, neighbors and healthcare professionals can give you useful reviews of doctors in your area, too. It may take some time to gather a list of doctors and winnow it down, but once you do, you can call their practices to ask about which insurance plans they accept.
Asking around is a good idea when considering a plan, too. Ask others about their experience with physicians who accept the plan, how out-of-pocket costs mount up, and whether they’ve had problems with filing claims or having services denied. These factors can vary by locale, so a colleague who lives in your area will be best informed.
One more tip: If your routine care involves tests or consultations with specialists, make sure that everyone involved in your care takes your insurance plan. Using in-network doctors and services will keep your costs down.
How Can I Choose the Best Health Insurance Company?
Several factors go into choosing a health plan that fits your needs: cost, choice of providers, user reviews, and other costs such as deductibles, co-insurance, and co-pays. Start by making a list of doctors who you want to be able to see, and check plan coverage to see if they are in the network. Next, find an online calculator that can help you compare total costs between plans.
What Is the Affordable Care Act?
The Affordable Care Act (ACA), also known as Obamacare—created to extend health coverage to millions of uninsured Americans—was signed into law in March 2010. The act expanded Medicaid eligibility, started the Health Insurance Marketplace, prevented insurance companies from denying coverage due to preexisting conditions, and required plans to cover a list of essential health benefits. Lower-income families qualify for subsidies for coverage purchased through the Marketplace.
What Is HealthCare.gov?
HealthCare.gov is a federal government website managed by the U.S. Centers for Medicare and Medicaid Services (CMS). It includes information about the federal Patient Protection and Affordable Care Act, as well as the federal government’s Health Insurance Marketplace.
The Bottom Line
Objective sources, such as insurance plan rankings, as well as subjective ones, such as the firsthand experience of colleagues, are both useful when choosing a plan.
Rankings tell you how one plan rates with large numbers of its customers, but valuable information also can be found among your colleagues, friends, and health professionals who have had experience with a particular plan that’s among your choices.