Understanding Health Insurance Jargon
Copay, coinsurance, deductible… what does it all mean? Being familiar with insurance terminology is key to being an advocate for your health as you use your existing health insurance plan or select a new one. As expected, the Kaiser Family Foundation found that Americans who have higher levels of education, are older in age, and have insurance are more likely to have health insurance literacy. Younger adults and those who are uninsured may need more help understanding how to use their plans, especially if they are being insured for the first time.
Similarly, the Urban Institute has found that even after controlling for income and health status, Hispanic adults have less confidence in understanding key health insurance terms than white, non-Hispanic adults. This demonstrates the challenges in addressing racial and ethnic disparities in health insurance coverage. Access to care relies on patients’ ability to effectively navigate the health care system and use their insurance plans. If you are not equipped with the fundamental vocabulary of these essential concepts, then your ability to make informed decisions about your health is severely impaired.
These gaps in understanding key terms also have implications for plan enrollment. Dr. Charlene Wong, a pediatrician and Robert Wood Johnson Foundation Clinical Scholar at the University of Pennsylvania, examined how educated, young adults selected health insurance plans on HealthCare.gov. As the participants navigated the HealthCare.gov website, they explained their thought process in real time and were later interviewed about their impressions and suggestions for improvement. This provided a unique perspective into the challenges young consumers would face when selecting a plan for themselves or for their family.
Dr. Wong found that technical difficulties or using the website itself was not a source of confusion but a major barrier was the lack of understanding of insurance terms. While almost all 33 young adults (ages range from 19 to 30) who participated in the study were college educated, only 52% knew what a deductible was. In addition, the participants felt that they were aware of what they wanted from a plan, but had difficulty matching their preferences to the 27 available plans due to the overwhelming amount of information.
Dr. Wong’s study highlighted the need for more guidance throughout the selection process. The participants suggested providing accessible definitions to clarify important terms and a way to narrow down plans based on price ranges and the inclusion of benefits such as dental and mental health coverage.
However, how exactly do adults who don’t speak English or those who are not able to teach themselves these terms sign up for coverage on the Exchange? Application assistance in the form of navigators and certified application counselors can be used to fill this gap. Dr. Benjamin Sommers, a health economist and physician at the Harvard School of Public Health, recently found that application assistance was the strongest predictor of successful enrollment.
Application assisters not only assist consumers throughout the eligibility and enrollment process but they also must display a level of cultural competence in understanding the norms, traditions, and cultural practices of the individuals from that community. It is their responsibility to put the Affordable Care Act in perspective to the applicant by gauging the consumer’s level of knowledge of the law and educating them accordingly.