Acing the Health Insurance Test

The second enrollment period for the federal and state insurance exchanges under Obamacare is well underway, and many people also renew or switch job-based insurance plans this time of year. But for a lot of people who must make important coverage decisions, many policy terms might as well be written in Swahili.

The Kaiser Family Foundation (KFF) is a nonprofit outfit that researches health issues and studies health policy, and is affiliated with the Kaiser Health News information service. It has no relationship to the Kaiser Permanente HMO. In advance of this year’s autumn insurance enrollment period, it conducted a national survey of nearly 1,300 adults to see how well Americans understood basic health insurance terms and concepts.

On the whole survey, 52 in 100 respondents got 7 of the 10 questions right, but only 4 in 100 scored a perfect 10.

Six of the questions were relatively easy – 2 in 3 respondents got them right. About 3 in 4 could correctly identify the terms “premium,” “provider network” and “annual deductible.” About 2 in 3 knew what was meant by “annual out-of-pocket limit,” and that if an insurer refuses to pay for a medically recommended service, the insured has the right to appeal.

Health-care literacy involves math, and respondents struggled with the question about out-of-pocket costs (about half got it right). The survey also asked respondents to calculate how much an insured patient would have to pay for a four-day hospital stay with a certain deductible and co-pay, and the amount they’d have to pay for an out-of-network lab test. Only 16 in 100 correctly calculated that last request.

Nearly 3 in 10 respondents correctly answered four or fewer questions, and 8 in 100 got no answers right.

Certain terms were widely misunderstood, including “health insurance formulary” – 1 in 3 got it right, and more than half said they didn’t know. Other gaps highlighted by the KFF survey concerned individual doctors’ care for an in-network hospital stay.

You can test your health-insurance knowledge by taking the quiz here. To read the whole survey report, link here. And for a health insurance glossary of terms, link here.

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