Advice and Explanations

  1. introduction    (show content)
  2. Let's get started    (show content)
  3. RATINGS OF AVAILABLE PLANS    (show content)
  4. OUR METHODS AND DATA SOURCES    (show content)

Consumers' CHECKBOOK/The Center for the Study of Services is an independent, nonprofit consumer organization founded in 1974. Our purpose is to provide consumers information to help them get high quality services and products at the best possible prices. So that there can be no question of bias, we don't accept donations from businesses and our websites and publications accept no advertising, referral fees, or similar payments.

I. introduction

Everyone in America should have health insurance. It protects you against unexpected and potentially million dollar health care costs that could destroy you financially. It protects you and your family. Under the Affordable Care Act (ACA), many changes have been made to health insurance in America. One of these changes is to require almost everyone to buy health insurance.

Another change is to reform and expand the ability of people to buy insurance through online marketplaces like DC Health Link. There are several ways people get insurance, including purchasing an employer-sponsored plan, and government programs such as Medicare and Medicaid. DC Health Link offers a third way, which is often the only way for those without coverage under other programs. The federal government also offers financial assistance to individuals and families within certain income limits who enroll through DC Health Link.

There are many insurance plans, many levels of financial help and it can be confusing or difficult to decide. The purpose of the CHECKBOOK Plan Comparison Tool is to help you understand your options, and to choose the plan or plans that are most likely to meet the needs of you or you and your family at the lowest cost.

What does the CHECKBOOK Plan Comparison Tool do?

This tool will help you choose the best health insurance plan to meet your needs and preferences. You can compare plans on key elements including cost, risk, quality and other features.

Cost: A single dollar amount estimate of average total cost for someone like you or your family compares plans not just on premiums or deductibles, but also on copayments, coinsurance, and other non-covered costs in the plan. Our cost estimates anticipate not only the costs you can predict but also the chances of having costs you can't predict. We boil all this complexity down into a single-dollar-amount figure for each plan, making comparison easy.

Risk: CHECKBOOK estimates what costs would be in a bad (high healthcare expense) year to help you assess the range of your financial risk under each plan. Plans can rank differently on costs in bad years than in average years. Our dollar estimate of cost in a "bad" year for each plan makes comparison simple.

Doctors: "Is my doctor in the plan?" ranks a close second to cost when you're choosing health insurance. We answer the question by letting you tell us names of doctors you care about. We then show you, on a single screen, which of your doctors are in-network for plans. Don't have a doctor? Our exchange-wide doctor directory lets you see which doctors in which plans are close to you, and learn more about their skills and qualifications.

Remember, if you're choosing a plan based on doctor participation, ALWAYS CALL YOUR DOCTOR TO CONFIRM THAT THE DOCTOR IS IN-NETWORK WITH THE INSURANCE PLAN YOU'RE CONSIDERING FOR THE UPCOMING COVERAGE YEAR AND IF APPLICABLE, ACCEPTING NEW PATIENTS. Doctor information is provided as a courtesy and may not be accurate so it's important to confirm with your doctor(s).

Will this tool tell me if I'm eligible for tax credit savings to help pay my premiums, and how much I can expect to receive?

Yes. By telling us about the members of your family who need coverage, the number of members in your household (everyone on your tax return), your household income and a bit more, we can calculate your likely premium tax credit savings and apply it to the cost comparisons for the plans available to you. Final calculation of any available tax credit will be performed through DC Health Link after you create an account and formally apply for the tax credit prior to choosing your health plan.

Remember, if your financial circumstances improve during the coverage year, you may qualify for less than the full savings estimate at the time of enrollment. Some consumers find it wise to use less than the full savings amount during the course of the year to make sure they don't owe the federal government money at the end of the year. If you're still owed money, it will come back to you as a credit on your tax return.

Will this tool tell me if any or all of my family members are eligible for other health insurance programs like Medicaid?

Based on the information you provide, we will tell you which family members may be eligible for insurance through DC Health Link or Medicaid programs. Final determination of eligibility for financial assistance programs will be made after you create an account and formally apply for assistance through DC Health Link.

What does it mean to me if one or more of my family members are offered health insurance through an employer?

If an employer is offering health insurance for which even one family member is eligible, there's a good chance you and your family members won't be eligible for tax credit savings to help you purchase insurance through DC Health Link, meaning you'll have to pay full price. Having insurance available from an employer won't prevent you from getting tax credit savings through DC Health Link if the employer coverage is too expensive, or if it doesn't cover the range of benefits required under the Affordable Care Act. "Too expensive" for the purposes of qualifying for tax credit savings is defined as about 10 percent of your income even to cover just one person.

What are the "plan types" and what difference does "plan type" make?

There are 4 types of plans available to you through DC Health Link: HMO, PPO, POS and EPO. The costs shown for each plan assume you use the plan's preferred providers. Your costs will be higher if you use providers that are out-of-network.

  1. An HMO (Health Maintenance Organization) usually only covers care from doctors who work with the HMO. It generally won't cover out-of-network care except in an emergency, and may require you to live or work in its service area to be eligible for coverage. HMOs often provide integrated care and focus on prevention and wellness. You may be required to choose a primary care doctor.
  2. With PPO (Preferred Provider Organization) plans, the PPO contracts with medical providers, such as hospitals and doctors, to create a network of participating providers. You pay less if you use providers that belong to the plan's network. You can use doctors, hospitals, and other providers outside of the network for an additional cost.
  3. A POS (Point-of-Service) plan is a combination of an HMO and a PPO. Typically it has a network that functions like a HMO – you pick a primary care doctor, who manages and coordinates your care within the network. Similar to a PPO, they usually also allow you to use a provider who is not in the network.
  4. An EPO (Exclusive Provider Organization) plan is a managed care plan where services are covered only if you go to doctors, specialists or hospitals in the plan's network (except in an emergency).

Plans that are eligible for HSA (Health Savings Accounts) are classified as High Deductible Health Plans (HDHP) and enable you to open a tax-preferred medical savings account at your bank to pay for qualified medical expenses. Funds in an HSA account roll over year to year if you don't spend them.

What do bronze, silver, etc. mean?

DC Health Link plans are assigned "metal levels" to indicate the actuarial value, or how generous the plans are for the consumer. Bronze means the plan is expected to pay 60 percent of expenses for an average population of consumers, silver 70 percent, gold 80 percent and platinum 90 percent.

Since these values are based on the population as a whole, the portion of costs they might pay for someone like you might be much higher or lower than the average for the whole population. Once you meet your maximum-out-of-pocket costs, plans pay 100 percent of the allowed amount for covered services.

Bronze plans typically have the lowest monthly premiums graduating up to platinum which typically have the highest. We recommend using our "Yearly Cost Estimate: Average for People Like You" as the best way to compare plans on cost for someone like you or your family.

Between two plans at the same metal level, one plan might offer much better protection, and therefore better "insurance value" for a subgroup—for example, for persons 55 years old with relatively poor health status, for persons with unusually high usage of expensive name brand drugs, or for very healthy persons who are unlikely to have high usage. There will also be substantial differences in relative insurance value to a user who, quite reasonably, wants to compare plans across levels—a bronze plan to a gold plan, for example.

II. Let's get started

One of the first things to consider is where you or you and your family should get your insurance. You can almost always get it through DC Health Link, but you may also have options through an employer, a parent (for children under the age of 26), a university plan or another source. Some or all of your family members may also qualify for Medicaid or Medicare. Which option or options are best and available for you or you and your family will depend on factors such as your income, employment status, family size and the age of each family member.

What are the main elements of cost?

There are two big elements of cost—the premium you'll have to pay to be in a plan, and the out-of-pocket costs you'll have to pay for healthcare services and products that the plan doesn't fully cover. You should rarely focus only on premium since a low-premium plan might have extremely high additional costs that you'll have to pay out-of-pocket

The CHECKBOOK Plan Comparison Tool helps you estimate what these extra costs might be for someone like you or you and your family. It helps you better understand both your premium and potential out-of-pocket costs.

How do premiums vary by age?

The dollar amounts vary by person, depending on age. Plans aren't allowed to charge more than three times as much for older people as for younger people, but older persons are more expensive to insure. Generally speaking, a 60 year-old can expect to pay about three times as high a premium as a 20 year-old.

Do pre-existing conditions, overall health or tobacco use impact my premiums?

No. The Affordable Care Ace mandates that premiums are only based on your age, NOT on your health status. In the District of Columbia, there is no impact on premiums for tobacco use.

Do premiums in the same plan vary by where I live?

The District of Columbia is considered one geographic area for premium purposes, so where you live in the District won't change your premium.

Why does the website ask questions about family size, ages, income, health status etc.?

The questions we ask are necessary to help calculate your eligibility, your premium costs, your premium tax credit savings (if any), whether you'll be eligible for a silver-level plan with reduced deductibles and other cost-sharing and whether family members might be eligible for Medicaid. To figure it out, we ask questions about ages, your income, household composition, pregnancy, and other matters. Optional questions on health status and expected major medical procedures help us calculate the likely (and not so likely) expenses of each family member but have NO impact on your monthly premiums.

What do I need to know about estimating income?

Your estimate of annual income for the upcoming coverage year is important because it impacts whether you may qualify for tax credit savings to help you pay for the insurance you select at DC Health Link, whether you'll be eligible to enroll in a silver-level plan with reduced deductibles and other cost-sharing, and whether family members might be eligible for Medicaid.

Common sources of income that should be counted in addition to wages and salaries are self-employment income, interest and dividends, alimony and Social Security.

Not everyone can accurately predict their future income over the next year. Pay increases, overtime, layoffs, job changes, and various other factors will affect income. It's important that you try to come close to the right figure so that our calculations of tax credit savings and eligibility are as close as possible to the calculations used when you actually apply for financial assistance through DC Health Link. At that time, you'll be asked for your Social Security number and other information which is checked against records at the Internal Revenue Service and other sources. When you use the CHECKBOOK Plan Comparison Tool, your information remains anonymous. We don't not make such checks.

One way of getting a good estimate is to look at your last tax return and think about likely changes, such as a promotion or changes in overtime pay. You can also think about weekly income or monthly income, and multiply to arrive at your annual income. The income that counts is your Adjusted Gross Income (AGI) with some minor adjustments that don't apply to many people. AGI is before taxes – your take-home pay is after withholding taxes. Your estimate should be before taxes. You can also look at your W-2 statements that you get from employers to help compute taxes, or look at your pay stubs.

How is the income figure used to calculate premium tax credit savings?

Your income is used along with your family size to determine if you're eligible. Where you are relative to the poverty level determines how much you'll be expected to pay for insurance and the amount of tax credit savings. For example, a family at 300 percent of the poverty level would qualify for a premium tax credit equal to the difference between about 10 percent of its income and the premium of the second, lowest-priced premium silver-level plan at DC Health Link.

What if I overestimate or underestimate my income when using this website?

If you over or underestimate your income, we might underestimate or overestimate the amount of tax credit savings and other financial help you may be entitled to receive. The actual calculations will be made when you create an account and apply for financial assistance through DC Health Link.

With the CHECKBOOK Plan Comparison Tool, you can try different income estimates for you or you and your family if you want to see how different income amounts would affect your tax credit savings or other financial assistance. You can select "Start Again" at the top of any page to redo your estimate.

What if I overestimate or underestimate my income when actually applying through DC Health Link?

DC Health Link may alert you to some errors if they are revealed by its check of government records. But if your application goes forward, keep in mind that if you overestimate your income, you'll receive a credit when you file your tax return for the coverage year. On the other hand, if you underestimate your income, you'll owe money to the IRS for receiving a larger tax credit than you should've. DC Health Link offers you the opportunity to set your tax credit to a lower amount as a safeguard should you wish to err on the side of caution.

Can I take a smaller tax credit than I'm entitled to now, and then get a tax credit to make up the difference when I file my tax return?

Yes. If you want to be sure you don't owe money when you file your federal tax return, you can take a smaller tax credit now. That means you'll pay more for premiums each month, but you'll receive a credit for the difference when you file your tax return and reduce your risk of having to repay some of the credit if you end up having a higher income than you originally projected.

What if I'm not a U.S. citizen? Am I eligible?

If you're not a legal resident of the United States, you're not eligible to obtain insurance through DC Health Link. You can call DC Health Link Customer Service at 1-855-532-5465 to learn about other options for getting health insurance.

My employer offers health benefits at work but I want to see if I can get a better deal at DC Health Link. Can I do that?

You can always shop for coverage at DC Health Link if you meet other eligibility requirements, but if you have access to job-based coverage, you probably won't qualify for premium tax credits unless your share of the employer plan premium is about 10 percent or more of your pay.

III. RATINGS OF AVAILABLE PLANS

Once you complete the questions asked by the CHECKBOOK Plan Comparison Tool and use the optional Doctor Directory search, you'll be taken to the summary plan results page. For most people, it will take only a few minutes to get this far. You'll see a display of all plans available to you ranked in order of the estimated average cost for someone like you, lowest cost first. You can scroll down to see all plans – a plan that costs more may have benefits that would be a better value for you or your family - or you can use the FILTER features on the left menu to narrow your choices by metal level, plan type, insurance company or cost parameters.

For each plan, we show you the name, what kind of plan it is, the monthly premium and annual deductible. If applicable, you'll also see what your monthly premium will be after tax credit savings are applied. We provide a Yearly Cost Estimate, Cost in a Bad Year and if applicable, whether your doctor is in-network for each plan. This is a unique display that can help you evaluate which plan or plans are right for you or for you and your family.

What is a Yearly Cost Estimate?

The "Yearly Cost Estimate" is an estimate of the average annual cost that people like you will pay for coverage. It's based on information you provided on how many people need coverage, age(s), health status and any anticipated medical procedures. It includes your premiums (after subtracting any estimated tax credit savings), and likely out-of-pocket costs (including deductibles, copayments and coinsurance). Out-of-pocket costs are your share of the costs not covered by your plan for doctors, hospitals, prescriptions and other services. The "Yearly Cost Estimate" is the best way to compare plans on cost, but please keep in mind this is only an estimate.

What is Cost in a Bad Year?

This is an estimate of costs (premiums plus your share of out-of-pocket costs) in a year when you have to use expensive health care services. It includes a major hospital visit and heavy use of outpatient services, and drugs. In most years, most people don't enter the hospital, so this is a very conservative measure of potential costs. We show you the likelihood (as a percent chance) that someone covered by your policy will experience such an expensive year based on the information you provided on how many people need coverage, age(s), health status, and any anticipated medical procedures. Based on your answers, we have defined a high-usage year as one in which bills for doctors, drugs, hospitals, and other products and services will total $30,000, $60,000, or $130,000 (the same usage assumptions apply to you regardless of which plan you review).These costs assume you only use providers that are in-network. If you use out-of-network providers, your costs could be significantly higher.

 

Which plans will I see?

You'll see all plans that are available to you. Everyone is not offered the same sets of plans. For example, only persons with incomes below 250 percent of the poverty line are offered silver plans with cost sharing reduction (CSR) which lowers the amounts for deductibles and provides other cost sharing not available to higher income people. This is an additional savings available only to lower income enrollees. Nor is everyone offered "catastrophic" plans. Catastrophic plans are available only to persons below age 30 and to some persons who qualify for certain hardship exemptions.

If a plan is available to you based on the information you entered, we show it. We don't screen out plans just because they have an HMO design, or a deductible above a certain amount, or a premium above a certain amount. We want you to see all the plans you can choose without any preconceived filters which eliminate plans that may actually be best buys. You can always use the filters on the left to narrow down your choices.

How can I see plan details or compare plans?

From the summary plan results page, select the plan name to view details of a specific plan. You can also compare plans and plan details by selecting the check box to the left of each plan and then select "Compare Selected Plans." On the comparison page, you'll also be able to compare in-network benefits and coverage features of each plan.

How does CHECKBOOK calculate cost ratings?

Our cost ratings tell you how much you're likely to pay for premiums after deducting any tax credit, plus out-of-pocket (unreimbursed) medical expenses. Our ratings assume that your bills may be for almost any type or size of expense, including: hospital room and board for surgical or medical care for any illness; other types of hospital services (operating room, anesthesia); surgery, in or out of a hospital; diagnostic tests, X-rays, and lab tests in or out of a hospital; doctor visits in or out of a hospital when you're ill; mental health treatment, outpatient and inpatient; mammograms, Pap smears, and routine immunizations; maternity, even if you're in a self-only plan; emergency care in or out of a hospital; prescription drugs, including insulin and syringes for diabetics; nursing care after an illness; chemotherapy and radiation therapy; physical and rehabilitation therapy; cosmetic ("plastic") surgery or oral surgery—only after an accident; preventive care including physical examinations and vaccines; and all of these expenses even if you have a preexisting condition or are hospitalized on the date when your enrollment begins.

If the information you provided on your health status indicates that you expect a particular type of major medical procedure this year, we also take that into account, including: vaginal delivery; caesarian delivery; laparoscopic surgery; hysterectomy; laminectomy; percutaneous coronary surgery, large bowel or lung resection; aortic reconstruction; cardiac valve surgery; coronary bypass; total hip or knee replacement and others.

With rare exceptions, no plan will pay for any of the following expenses and we don't cover them in our comparisons: cosmetic or plastic surgery, except after accidents or a disfiguring illness; custodial nursing home care, or any kind of rest care; personal comfort items such as telephone or television while in the hospital; non-prescription, over the counter drugs, such as aspirin; care that is fully paid by another insurance provider; care that is not medically necessary; experimental care (clinical trials are partly excepted); charges that are higher than the plan "allowance" or what the plan has determined to be "reasonable;" and expenses incurred before joining or after leaving a plan.

All plans cover preventive exams without deductibles or copayments. Even among plans that cover all services generously, there are always some limitations, such as coinsurance and deductibles. Our tables take the major benefit limitations such as these into account in estimating costs. However, we cannot address every single coverage nuance or difference (such as which organs are eligible for transplantation, or which "specialty drugs" are included in plan formularies). Nor can we assure that all plans will make identical medical necessity decisions in close cases—and they won't. Nor can we reflect extra benefits the plan may provide if, for example, it can save money by giving you more home nursing than its normal limitation on this benefit.

Hence, all of our calculations should be considered approximations that will be broadly accurate in the great majority of situations but that cannot provide precise predictions that cover every possible situation. What our calculations can do is take into account the risks of very high health care costs from an unexpected illness or accident and the likelihood of having such expenses.

I can't afford to pay much for deductibles and co-pays. Does DC Health Link offer help for cost sharing and do you take this into account in your plan ratings?

If your income is too high to qualify you for Medicaid but below 250 percent of the federal poverty level, you can qualify for cost sharing reduction (CSR) plans. These reduce the deductibles, copays, and other cost sharing that would otherwise apply to covered services and you still get the premium tax credit. Our analysis shows that these plans are often the best buys for enrollees whose income is below $29,425 (one person), $39,825 (two persons), $50,225 (three persons), etc.

The cost sharing reductions are available through modified versions of silver plans. These plans have lower deductibles, copays, coinsurance, and out-of-pocket limits compared to regular silver plans. If you're eligible for cost sharing reductions, we show you the appropriate plans and our ratings take this into account.

If I use my premium subsidy for a bronze plan, I can save even more money on the premium. Can I also get a cost-sharing reduction through a bronze plan?

No. You can only get cost sharing reductions by enrolling in a silver plan. There are no cost sharing reductions if you enroll in a bronze, gold, or platinum plan. This is a special savings, different from the rule for premium tax credits. You can apply premium tax credits to all four types of plan. However, if you're eligible for both kinds of help (that is, if your income is too high for Medicaid but below 250 percent of the federal poverty level), you can receive both types of savings in a silver plan. An important value of our ratings is that they show you how much you're likely to spend, in total, for each of your plan options: bronze, silver, gold or platinum.

IV. OUR METHODS AND DATA SOURCES

The CHECKBOOK Plan Comparison Tool compares plans based on their likely dollar cost to you, including both known expenses of the premium and the out-of-pocket expenses you face for costs the plan does not pay. We estimate out-of-pocket expenses using actuarial methods juxtaposed against the cost-sharing details of each plan. Most of the analysis underlying the CHECKBOOK Plan Comparison Tool is aimed at quantifying, and expressing in terms of annual costs, the various risks you face and the reimbursement provided by each plan at each level of risk. We calculate costs assuming that you use only preferred providers, or providers who will agree to in-network fees, both because sensible consumers will avoid leaving the network if they can, and also because there is no realistic way to estimate the many unknown rates that individual providers may charge out-of-network.

We calculate likely out-of-pocket costs, taking into account the probabilities of families of various sizes and ages incurring a wide range of expenses, from a zero cost year to a very high cost year for someone like the user. The low cost situation is most common, but when weighted for dollar amounts, accounts for a relatively small portion of statistically expected spending. Put in statistical terms, health care expenses are a highly "skewed" distribution, and the average (or "mean") is far higher than the typical (or "median") spending level.

Although most people don't know whether they will incur large expenses or not—heart attacks, serious accidents, and most other costly scenarios are relatively unpredictable—some people do have a pretty good idea of some of their future costs. For example, a person may be planning major surgery for a congenital problem. We present data for both groups: persons with and without good information on next year's expenses; and for those with good prior information, estimated out-of-pocket expenses at several expense levels for each plan.

We caution users to beware of attempting to estimate the costs of "known usage" expenses for anything much beyond maintenance drugs. The problem is few are likely to know, and few have access to information on such simple questions as the number of visits involved in dealing with a pinched nerve, or with the mix between hospital and surgical costs for a condition such as a knee or hip replacement. No one is likely to know if he or she will have a heart attack, a stroke or a case of Lyme disease next year. Our methods don't force you to make guesses over such matters, or to pretend that the worst won't happen.

The percentage estimates for expenses of various amounts in the cost tables used in the CHECKBOOK Plan Comparison Tool are based on information taken from a number of sources. The most important of these is the Medical Expenditure Panel Survey (MEPS) of the Agency for Healthcare Research and Quality. This detailed survey produces information on what proportions of the population incur expenses at various dollar levels. We adjust MEPS data slightly to accommodate regional expense variations and edical inflation. Our cost tables also use rounded estimates to make them easier to read, and the cost headings represent ranges.

Because some plans impose different deductibles and coinsurance for different services, the distribution of costs between hospital and other expenses can significantly affect the amount that a plan will require you to pay for a particular expense total. We model our comparisons closely to average experience. Though few persons or families will have exactly the same cost profile as used in our tables, most situations will be at least close. Our profile, when weighted for probability, corresponds closely to projected expenses of the employed American population as a whole, both in total and in category of expense.

What other assumptions apply to CHECKBOOKs cost comparisons?

The cost comparisons provided by the Checkbook Plan Comparison Tool make several other simplifications. We apply our methodology consistently across plans, so that any estimating problem is likely to be small in its effects on the comparative information in the cost tables.

  1. In analyzing most plans we have to make assumptions about the number of doctor visits and prescriptions to calculate the patient's share of expenses.
  2. We assume that all bills are for amounts negotiated between plans and preferred providers (often called the "plan allowance"). Plan allowances are for most plans the highest amount that the plan will cover. Many doctors who aren't in the plan network charge more than the plan allows, and all plans don't have the same "profiles" for calculating their maximums. Absent any basis for adjustment, we simply assume what is generally true: all preferred doctors have agreed to limit their charges to plan allowances, and some others will agree to meet that level (or will do so if you tell them what plan you have and explain your cost concerns). There are instances in which some plans' schedules for some procedures are well below those used by other plans. Unfortunately, there is no way to adjust for this in our tables, though you can protect yourself in the real world by using preferred providers or by getting your provider to promise to stay within your plan's payment level before getting any expensive service.
  3. We assume that you take advantage of the best cost-sharing rate in each plan. Specifically, we assume that you get network rates by using network providers rather than providers who aren't preferred with that plan. For drugs, we assume you use those in the plan formulary.
  4. We make assumptions about how many family members incur expenses at each total cost level in a year to calculate deductibles. For example, we assume that in a year with $1,000 in expenses, a family of five will have expenses for three members, and in a year with $130,000 in expenses, for all family members. In the real world, no one's actual set of yearly expenses will exactly match our assumptions. For plans whose coinsurance rates and deductibles are low or the same for most services, a different mix of expenses would have little or no effect on the cost estimates we present. For other plans, such as those with 100 percent coverage of hospitalization and limited coverage of prescription drugs, a different mix of expenses could change the estimates considerably. However, a different mix would not likely change any cost entry at $3,000 by more than two or three hundred dollars, or any entry for the $30,000 column by more than one or two thousand dollars. (Highly expensive specialty prescription drugs, such as AIDS drugs, hemophilia drugs, growth hormone drugs, some chemotherapy drugs, and some osteo-arthritis drugs are the most important potential exceptions.)