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Many Consumers Unaware Of Their Rights To Appeal Claims, Financial Effects Of Going To Out-Of-Network Physicians

WASHINGTON, D.C. (Nov. 10, 2009) — With worries about the H1N1 virus and the national debate over the future of health care, it is more important than ever for consumers to get smart about their health insurance coverage. However, the National Association of Insurance Commissioners‘ (NAIC) latest Insurance IQ survey finds that consumers are unaware of some key aspects of their health insurance coverage that can have a significant effect on their wallets.

In the survey of 1,000 consumers conducted Oct. 21-26, only six in ten consumers (61%) understand their rights to appeal a denied health insurance claim and fewer than one in three consumers strongly understands the cost factors that determine their health insurance premiums. Additionally, a strong minority of consumers (19%) also acknowledge they may go to an out-of-network doctor for health care insurance coverage.  These consumer attitudes toward understanding health insurance trigger clear financial implications. 

“In this economic environment, consumers need to understand all of the factors that impact the cost of their health insurance,” said NAIC President and New Hampshire Insurance Commissioner Roger Sevigny. “By getting smart about their policies and tapping into the resources available, consumers will be more confident about their insurance choices and learn to make cost-effective decisions without sacrificing important coverage needs.”

How to Improve Your Health Insurance IQ

These tips can help consumers better understand their health insurance needs and requirements so they can better protect their loved ones and themselves.  

  • Conduct a Coverage Checkup: By getting smart about their health insurance coverage, consumers can more easily understand the cost implications of various procedures and services. For example, going to an out-of-network doctor versus in-network traditionally costs a consumer much more for the same type of service. Do your homework,  research all the options available and review your insurance policy before making any decisions.
  • Take Advantage of Your Open-Enrollment Period: Open Enrollment refers to the time period when members of a group health insurance plan can enroll in or change certain programs and benefits. During this period, insurance carriers are required to accept all applicants of the group without underwriting or evidence of insurability. It is also a good time to review your coverages, deductibles and provider or prescription drug lists. Generally, open enrollment occurs just once a year and, if you miss that time, you likely will not be able to enroll in your employer-sponsored health insurance program or make changes to your options until the following year. Check with your human resources department to see when your company‘s open enrollment period begins and ends, and when your policy goes into effect.

  • Contact Your State Insurance Department: Every state has an insurance department ready to help with any question or complaint a consumer may have about coverage. With many health insurance policy details developed and managed at the state level, consumers should reach out to their state insurance commissioner to learn more about how their local laws affect their coverage. To find out more, contact your state insurance department by visiting
    • State Consumer Protections: State law provides a variety of important protections through state law. These may include the appeal of denial of coverage decisions within the insurance company or to an impartial external reviewer; prompt payment of claims; access to certain specialists and health care providers; and coverage of specific treatments and services.
    • Insurance Premiums:  States vary in the methods they permit for calculating premiums. The ranges of premium rates an insurer can charge are typically set by state law. However, in other states, a method called “community rating” helps determine premiums, where everyone in a specific geographic area pays the same rates for health insurance.
  • Create a Rainy Day Fund: It is crucial that consumers put aside savings into a rainy day fund to cover any expenses in case an emergency happens. One way to do that is with a Flexible Spending Account (FSA). Health insurance policies do not always pay for such procedures as allergy tests or braces, but an FSA can help save on these out-of-pocket costs by allowing you to set aside pre-tax dollars for uninsured medical expenses and child care. Ask your human resources department about your employer‘s FSA and what types of expenses can be reimbursed through the program. Be aware, however, that any unused money in an FSA does not roll over to the next year, so try to estimate your costs carefully at the beginning of the year.

More Information
For additional information about auto, home, life and health insurance options — as well as tips for choosing the coverage that is right for you and your family — visit

Survey Methodology
The NAIC conducted the Health Insurance IQ study Oct. 21-26. The participant sample included a nationally representative sample of 1,000 American adults ages 18 and older with a margin of error +/- 3.1 percent in 95 out of 100 cases.

About the NAIC

Formed in 1871, the National Association of Insurance Commissioners (NAIC) is a voluntary organization of the chief insurance regulatory officials of the 50 states, the District of Columbia and five U.S. territories. The NAIC has three offices: Executive Office, Washington, D.C.; Central Office, Kansas City, Mo.; and Securities Valuation Office, New York City. The NAIC serves the needs of consumers and the industry, with an overriding objective of supporting state insurance regulators as they protect consumers and maintain the financial stability of the insurance marketplace. For more information, visit

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