It is important to know how an insurance plan relates to your needs and to understand the basics so you can more easily access affordable, quality care.

Common Insurance Terms

When it comes to weighing your insurance options, sorting through the various terms and processes involved in choosing the right plan can be overwhelming. Often, having a chronic disease like cystic fibrosis brings more complications, financial strains, and other coverage burdens to this task.

As a person with CF, you may find that choosing the right insurance plan affects your daily life. For this reason, understanding the insurance basics is key to ensuring you have access to quality care.

To understand the basics of health insurance, it is helpful to first know some common terms. Knowing these common insurance terms can help you select a plan that best meets your needs.

Types of Health Insurance

Depending on your employment status, household size, and income, there are several different types of insurance that you can purchase or qualify for. The three primary types of insurance are private (also known as commercial) or employer-based, the Health Insurance Marketplace and public insurance such as Medicare and Medicaid.

Commercial, Private, or Employer-Based Insurance Plans

Private or commercial insurance is health coverage purchased directly from a health insurance company either with a group, such as an employer, labor union, university, or individually. Any business with 50 or more full-time-equivalent employees is required to provide health insurance through a private employer-based plan.

These plans vary greatly in what health services are covered and how much each individual must pay for premiums and other out-of-pocket expenses. Employees are often able to add their spouse or dependents to a group insurance plan for a higher monthly premium cost. If you wish to change your plan or enroll in a new one, you can do so during the open enrollment period, which may vary depending on the type of insurance you have.

COBRA

The Consolidated Omnibus Budget Reconciliation Act (COBRA) is a form of employer-based coverage that gives employees and their families the option to extend their insurance in the event that they lose job-based health coverage. An employer is required to offer COBRA if it has 20 or more employees on more than 50 percent of its typical business days. For COBRA, most qualified individuals are required to pay the full cost (which cannot exceed 102 percent of the premium, or the full cost of the coverage plus a 2 percent administration charge) of the plan. COBRA coverage can continue for up to 18 months.

Once you opt into COBRA, you cannot drop it and switch to a Marketplace plan until the following year or until the open enrollment period, as voluntary loss of coverage is not considered to be a qualifying life event for the special enrollment period.

Those who decide not to take COBRA coverage can enroll in a Marketplace plan instead but will typically be asked to make a decision fairly quickly once the loss of job-based coverage occurs. The choice between COBRA and a Marketplace plan largely depends on your individual circumstances and varies on a case-by-case basis, but a Cystic Fibrosis Foundation Compass case manager can work with you one-on-one to weigh the pros and cons of each option and help you decide on the right plan.

Group Insurance Plans

The majority of individuals in the United States have group health coverage through their own or a family member's employer. There are two types of employer-sponsored coverage: fully-funded group plans and self-funded group plans.

In a fully-funded group plan, the employer purchases coverage from an insurance company and the insurance company processes and pays health care provider claims.

In a self-funded group plan, the employer sometimes assumes the role of the insurance company, and processes and pays health care provider claims. However, in some cases, there may be a third-party administrator that assists with health insurance claims. For self-funded plans, it is often up to the employer to decide whether or not to cover a service. In most cases, appeals are made directly to the employer's human resources (HR) department.

Individual Plans

Individual health insurance plans are another type of private insurance purchased by individuals or families directly from an insurance company or through the Health Insurance Marketplace.

Marketplace Plans

The Health Insurance Marketplace, also known as the Health Insurance Exchange, was created as a result of the Affordable Care Act (ACA) to help U.S. residents pay for health care. For those who do not have access to group-based employer plans or do not qualify for Medicare or Medicaid, the Marketplace provides a way to go online and purchase a plan in order to ensure that they have adequate health coverage.

Although some states are in the Federally-Facilitated Exchange, others have their own state-based Exchanges that function very differently. This means that the way a Marketplace plan works varies by state. To access the Marketplace for the state in which you live, visit healthcare.gov

Typically, Marketplace insurance plans are grouped by levels of coverage classified by different types of metals:

  • Bronze: Bronze plans offer the least amount of coverage but are also the least expensive in terms of monthly premiums. On average, with a bronze plan, you will pay 40 percent of your health care costs.
  • Silver: With a silver plan, you will usually pay 30 percent of your health care costs.
  • Gold: Gold plans typically require you to pay 20 percent of your health care costs.
  • Platinum: Platinum plans offer the most amount of coverage but are also the most expensive in terms of monthly premiums. On average, with a platinum plan, you will pay 10 percent of your health care costs.

As with Medicare, you also need to sign up for a Marketplace plan during that year's open enrollment period, which in 2017 is from November 1 through December 15. However, those who qualify for special enrollment periods due to a qualifying life event or other unusual circumstance can still buy a Marketplace plan outside of the open enrollment period. For a list of qualifying life events, visit healthcare.gov.

Marketplace Subsidies

If you do decide to purchase a plan from the Health Insurance Marketplace, you may be eligible to receive financial assistance from the federal government in the form of a Marketplace subsidy. There are two main types of Marketplace subsidies -- a premium tax credit and a cost-sharing reduction -- which are available based on your household size and income.

If you live in a state that has expanded their Medicaid eligibility under the Affordable Care Act and your income falls between 138 percent and 400 percent of the federal poverty level (FPL), you can qualify for a premium tax credit to be put toward your tax return the following year or used up front to have a lower monthly premium. If you live in a state that has not expanded their Medicaid eligibility, the income range to qualify for subsidies is between 100 percent and 400 percent.

Although most people will choose to pay less for coverage each month, it may be a good idea for individuals whose incomes fluctuate a lot, for example, to wait until they do their taxes to use their subsidy.

* For Alaska and Hawaii, see the U.S. Federal Poverty Guidelines, U.S. Department of Health & Human Services.

Plans purchased on the Health Insurance Marketplace also offer a subsidy called a cost-sharing reduction, which is available to people with incomes between 100 percent and 250 percent of the FPL. Individuals who fall within this category can not only take advantage of the premium subsidy but also choose between special, limited income-based, silver plans featuring lowered co-pays and deductibles

For this reason, people who meet these income requirements should be sure to look into silver Marketplace plans when considering coverage as opposed to automatically defaulting to the cheapest option.

Considering a Plan

When it comes to deciding if a Marketplace plan is right for you, you should start by answering a few key questions. First of all, you need to know if you are eligible for subsidies for your plan. Second, it is important to make sure that your doctor and pharmacy are in-network before selecting a plan. Although lower health insurance costs up front may seem appealing, making sure that the plan you select effectively covers specialty care and treatments from your CF care center is extremely important and can ultimately help you save in the long run. 

Deciding if a Marketplace plan is right for you depends largely on you and your specific health care needs, medications, and treatment plan, so it is important to consider different factors before making a decision. A CF Foundation Compass case manager can help you weigh these factors and calculate each plan's overall expenses to determine the best type of insurance for you.

Download our Benefit Assessment Checklist for more information on choosing the right plan.

Government Programs

Government health care programs are government-funded and provide health care assistance to qualifying individuals and their families. The largest of these programs are Medicare and Medicaid, but government health care programs also include the Veterans Health Administration (VHA), the Children's Health Insurance Program (CHIP), the Department of Defense TRICARE and TRICARE for Life programs (DOD TRICARE), and the Indian Health Service (IHS).

In addition to these federal programs, many states offer assistance programs for managing your CF care. State-level programs for children with special health care needs (sometimes called CSHCN programs) provide assistance for coverage of care for certain chronic conditions, such as CF. In most states, families that do not qualify for Medicaid may be eligible for this program, although some states require enrollment in Medicaid to qualify. Some states may also offer this program to adults who have a qualifying diagnosis. 

To learn more about the government programs available in your state and to find out if you are eligible for assistance, contact your CF care center or CF Foundation Compass.

Primary vs. Secondary Insurance

Today, a quarter of people with cystic fibrosis report having more than one form of health insurance coverage. In these cases, you will have both a primary and a secondary insurance provider, and your benefits must be coordinated.

Your primary health insurance plan is the first to pay for services or treatments you receive from a health care provider. However, if the primary plan does not cover a service or treatment completely or at all, then your secondary health plan or program may cover that care. For help coordinating your benefits or to clarify if a plan is considered primary or secondary, you can always review your insurance plan, speak with a member of your CF care team or call CF Foundation Compass.

844-COMPASS (844-266-7277)
Monday - Friday, 9 a.m. - 7 p.m. ET
compass@cff.org

Types of Health Insurance Plans

Another key aspect of understanding health insurance basics is understanding the different types of available plans. Health insurance can be complicated and expensive, but learning more about the makeup of various plan types can help you make the most of your coverage and evaluate your options.

When it comes to health insurance, many people get their plans through their employer or directly from a private health insurance company. Other people may receive health insurance through a state or federally-funded program such as Medicaid or Medicare.

There are five main types of insurance plans:

Provider Networks and How They Work

A provider network is a set of doctors, hospitals, clinics, and other health care providers that are contracted with your health insurance plan to provide care at a reduced cost. Almost every health plan uses a network because it helps lower costs while still providing safe, quality care at a contracted rate.

Because many people with CF and their families develop close partnerships with their CF care teams, knowing whether your CF care center is included in a plan's health insurance network is a key factor when selecting the right plan. Not all health care providers are contracted under a plan's provider network, so it is important to know what is considered in-network and the policies regarding out-of-network coverage before enrolling in a plan.

The way that a provider network works depends largely on the type of health insurance plan you select. You will typically find that a single health insurance company will offer several different plan options. The plan you choose will ultimately determine the size of your provider network, the rules for seeing a specialist, and how much you will pay each time you receive care. 

Health Maintenance Organization (HMO)

A health maintenance organization (HMO) plan is a type of health insurance plan that limits coverage to health care providers who are contracted with the HMO network. This means that the plan covers care only from providers specifically indicated as being in-network and does not pay for care outside of the HMO network, except in the case of an emergency. HMOs require you to choose a primary care physician (PCP), who must then give you a referral to see any specialists. Without this referral from your PCP, HMO plans do not cover care from a specialist and you will be responsible for most, if not all, of the associated costs. In addition, an HMO may require you to live or work in its service area to be eligible for coverage.

The primary benefit of HMOs is that they have lower premiums and may not have a deductible. In addition, co-payments for doctor or emergency-room visits will likely be minimal.

Although HMO plans may feature lower health insurance costs up front, they can also be more restrictive in terms of which services are covered and how you can access them. This means that you may have fewer options in terms of coverage, care, and providers, but you may still be able to get the care you need.

Preferred Provider Organization (PPO)

A preferred provider organization (PPO) plan is a type of health plan that allows for relative freedom when choosing providers outside of a plan's network. With PPO plans, you pay less for care from in-network providers but can still receive coverage for out-of-network care without a referral or PCP, at an additional cost. 

Therefore, PPO plans generally give you more freedom and flexibility than HMO plans. However, they often cost more, too. If you do decide to enroll in a PPO plan, you will pay higher monthly premiums and out-of-pocket costs in exchange for the flexibility to choose providers both in- and out-of-network. 

Exclusive Provider Organization (EPO)

Exclusive provider organization (EPO) plans combine the flexibility of a PPO plan with the cost-saving benefits of an HMO plan by giving you the freedom to choose any provider within an EPO network without selecting a PCP. In addition, EPO plans do not require referrals to see a specialist. 

However, it is important to note that EPOs do still offer a limited network of health care providers to choose from, so it is important to confirm that your CF care center is in-network before enrolling in an EPO plan. If you do go to a doctor or hospital that doesn't accept your plan, you will ultimately be responsible for paying all costs associated with that care.

Point of Service (POS) Plan

A point of service (POS) plan combines different elements of HMO and PPO plans. Like an HMO plan, you must choose a PCP, but you can also go outside of the provider network for health care services with greater out-of-pocket costs like a PPO plan. However, services provided by the PCP are typically not subject to a deductible, and a wide range of preventive care benefits are also included. 

Therefore, the primary benefit of a POS plan is that it offers a “middle of the road” option in which the policy holder can have more choices than what an HMO plan typically offers while paying fewer costs than with a PPO plan.

High-Deductible Health Plans

HSAs

A health savings account (HSA) is a tax-exempt medical savings account that is paired with a high-deductible health plan. HSAs are similar to personal savings accounts, but the funds are limited to health care expenses.

FSAs and HRAs

You may also be eligible for a flexible spending account (FSA) or a health reimbursement account (HRA). 

For more information on HSAs and FSAs, including tips for comparing the different options, visit:

The Medical Benefit vs. The Pharmacy Benefit

Almost every insurance plan has a set of defined pharmacy and medical benefits. Understanding how your plan's pharmacy and medical benefits will be handled by your health insurance provider is an important aspect of choosing the right plan.

Understanding Pharmacy Benefits

A plan's pharmacy benefits determine the level of coverage for prescription medications. Most health insurance plans have a tiered structure for pharmacy benefits, offering different co-payments that increase in price as you move up each tier. Most plans have three or four tiers for prescription medications:

  • Tier 1: Generic medications (least expensive)
  • Tier 2: Preferred brand-name medications
  • Tier 3: Non-preferred brand-name medications
  • Tier 4: Specialty medications (most expensive)

Since each tier has different costs associated with it, it is important to know where your medication falls within this tiered structure before selecting a plan. Even though a plan's Summary of Benefits may list a certain co-pay amount for prescription medications, this rate will likely not apply if your medication falls under a higher tier. For this reason, understanding a plan's drug formulary and pharmacy benefits is extremely important for determining your overall health insurance needs.

Understanding Medical Benefits

A plan's medical benefits primarily pertain to services such as care center visits, hospitalizations, in-home intravenous (IV) services, medical devices, therapies, respiratory therapies, procedures, and lab work. Any service that falls under the medical side of your plan's benefits is subject to the medical deductible and to co-payment or co-insurance.

You may or may not have a separate deductible or out-of-pocket maximum, but every plan has a set structure for medical and pharmacy benefits. For this reason, you may want to call CF Foundation Compass to find out if a service falls under the medical or the pharmacy side of your plan's benefits.

Covering Specialty Medications

Specialty medications, or medications that you can receive only from a specialty pharmacy, can be covered under the pharmacy benefits, the medical benefits, or both, depending on the structure of your plan. A specialty pharmacy is a type of pharmacy that typically serves members with rare and chronic diseases. It also:

  • Focuses on high-cost biotech drugs such as injectable or inhaled medications
  • Provides value-added services such as refill reminders, overnight deliveries, and the ability to track prescription status online
  • Provides therapy management over the phone to ensure safety and compliance

Medications from specialty pharmacies typically need to be handled and stored in a particular way to maintain their effectiveness, and are often unavailable at local retail pharmacies. For this reason, you may need to go to multiple pharmacies to get all of your CF medications, including some specialty ones. To learn more about covering specialty medications, contact CF Foundation Compass by calling 844-COMPASS (844-266-7277) Monday through Friday, 9 a.m. until 7 p.m. ET, or emailing compass@cff.org.

You can also learn more about getting your medications covered from a CF Foundation Compass case manager on our CF Community Blog.

Handling Prior Authorizations

A prior authorization is a formal review and approval process conducted by your insurance company before it will agree to cover a service. Insurers conduct prior authorizations to make sure that patients meet specific criteria prior to approval to ensure that the requested treatment is medically necessary and to help contain the overall cost of care. 

Understanding Prior Authorizations

It is important to secure a prior authorization if your plan requires it because without this approval, a medication or service may not be covered, leaving you responsible for the entire cost. Requests for prior authorizations must be made prior to obtaining services. Prior authorization approval is not a guarantee your insurance plan will cover the cost.

Certain types of products and services generally require a prior authorization, including:

  • Brand-name medications or devices for which a generic substitute exists
  • High-cost or specialty drugs, such as those designed for the treatment of cystic fibrosis
  • Medications, devices, or treatments used to treat non-life-threatening conditions
  • Medications, devices, or treatments prescribed at higher than the standard dosage or frequency
  • Medications, devices, or treatments not listed as covered by a health plan but deemed medically necessary by a physician
  • Medications, devices, or treatments used for cosmetic purposes

“The prior authorization process can take up to 72 hours for standard requests. Ask your doctor if he or she can submit an urgent request, which will be reviewed by the health plan within 24 hours. Keep in mind that even if the medication is approved, the approval may be valid for only a limited time, so it is important to plan your refills accordingly.” 
-- Yamini Saxena, CF Foundation Compass Senior Case Manager 

When Prior Authorization is Needed

Typically, medications specifically designed for the treatment of CF require a prior authorization. In most instances, your pharmacy or care center will let you know if a prior authorization is needed, but you can also find out directly from your health plan.

Reviews and Approvals

Prior authorization requests are reviewed by a team of clinical experts at the insurance company. If a prior authorization request needs additional review, it may be escalated to a physician at the insurance company.

Once your prior authorization is approved, the timeline for how long the approval is valid will vary. Your health insurance company will let your care center know how long it is valid. Once approved, you can get your medication covered under your insurance plan until the prior authorization expires.

If your prior authorization is not approved, you can start by calling the insurance company to request the reason for denial and ensure that all the required information was submitted. For medications and devices, be sure to confirm that the pharmacy followed the correct billing procedures. You should also check on whether the insurance company will accept and evaluate additional documentation from your health care provider without an appeal.

If your insurer will not accept additional documentation or there is no additional documentation available, you will need to work with your provider to file an appeal.

Need Help With Prior Authorizations?

CF Foundation Compass can help you get prior authorizations by calling your CF care center or pharmacy. CF Foundation Compass is a personalized service that works with you through insurance, financial, legal, and other issues. 

To make sure your prior authorization process runs as smoothly as possible, Compass can help by coordinating communication with the provider. You may also want to ask your Compass case manager if your medication or service requires reauthorization, as the qualifications for this often differ by state and insurance provider.

844-COMPASS (844-266-7277)
Monday - Friday, 9 a.m. - 7 p.m. ET
compass@cff.org