How to Pick an Insurance Plan You Can Afford

People shopping for health insurance often consider little except different plans' premiums and deductibles. That's a big mistake, says Nancy Davenport-Ennis, especially in the individual market, where copayments and caps on coverage are increasingly appearing in unexpected places. "We're seeing policies with $150 daily copayments for radiation services," says Davenport-Ennis, cofounder and CEO of the Patient Advocate Foundation, which helps people find and pay for healthcare services. "Someone with cancer may have to pay that every day for 30 days."

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Here's what else to look for in a plan:

• Annual or daily caps on specific types of care or services, like oncology care, or radiation and rehabilitation services. A $30,000 annual cap on cancer services, for example, won't get you far if you need surgery, and $10,000 in annual outpatient services isn't likely to cover a course of radiation.


• Cost-sharing requirements: copayment or coinsurance amounts and coverage limits for routine office visits, specialists, drugs, and hospital admissions. The plan may charge a $25 copayment for a visit to your primary-care physician but increase that to $40 if you see a specialist.


• Generic vs. brand-name drug coverage. "There's a clear emergence of health plans that cover only generic drugs," says Davenport-Ennis.


• Annual out-of-pocket maximum. Make sure you could afford to pay whatever this figure is every year if you get sick, and remember that copayments generally don't count toward the limit.


• Lifetime coverage limit. Many serious illnesses are now considered chronic conditions rather than fatal diseases. With expensive medical treatments, a lifetime coverage limit of $1 million won't be enough for many people.

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