Health Plan Shares Insurance Definitions to Boost Member Health Literacy

In honor of National Health Literacy Month, Sunflower Health Plan shared the definitions to some basic health insurance terms with its members to improve member health literacy.

During National Health Literacy Month, some payers take action to support members’ understanding of health insurance terms and processes. Sunflower Health Plan’s press release was a reminder that, occasionally, simple steps can help address healthcare challenges.

“At Sunflower Health Plan, we recognize that the language of healthcare and health insurance is confusing for many. That's why we strive to demystify health insurance and help residents understand their options by giving clear communication in our materials and on our website,” Michael Stephens, Sunflower chief executive officer and president, explained in the press release.

The health plan, which serves Medicaid, Medicare, and Marketplace members in Kansas, released a list of important health insurance terms that members will need to know in order to navigate their health insurance options. The terms were published on the payer’s website in the newsroom section.

The list covered simple definitions for a network, premium, deductible, copayment, coinsurance, and out-of-pocket maximum.

The payer cited data from the Centers for Disease Control and Prevention (CDC) which found that better healthcare literacy could produce savings of nearly $25 billion in a year by preventing around 1 million hospital visits.

“We want everyone to be empowered to make the most informed health insurance decisions for themselves and their families,” Stephens said.

In September 2022, a week before National Health Literacy Month started, the health plan also issued a press release directed toward providers with simple steps to help them build health literacy among their patient populations.

The press release encouraged providers to use the “teach-back” method. First, the provider explains a piece of healthcare information—such as a treatment or payment process—to the patient in easily comprehendible language. Then, the provider asks the patient to explain the information back to them to gauge comprehension.

To use this research-based healthcare literacy intervention, the payer recommended that providers use a caring tone and relaxed body language.

“Emphasize that the responsibility to explain clearly is on you, the provider,” the press release stated.

If the patient struggles to repeat the information back or incorrectly recalls a detail of the information, the provider can explain the information again and use the teach-back method a second time.

Approximately three out of four adults said that they were concerned about financial hardships driven by medical bills, according to a MITRE-Harris Poll Survey. This was in part because four in ten adults reported only somewhat understanding basic aspects of their health plans including copays and deductibles.

A separate study found that as many as 77 percent of Americans were confused by basic heatlh insurance terminology, demonstrating the need for a stronger push toward widespread healthcare literacy.

The timing of National Health Literacy Month conveniently coincides with the beginning of Medicare open enrollment and comes slightly before the federal marketplace’s open enrollment season, which begins on November 1.

Previous studies have identified that Medicare Advantage enrollees tend to have higher health insurance literacy. Nearly four out of ten Medicare Advantage enrollees (38 percent) reviewed or compared their health plan options each year, demonstrating high health insurance literacy. In contrast, only 27 percent of those with low health insurance literacy reviewed their coverage.

Additionally, individuals who reported having access to enough information to compare coverage and who stated that it reviewing coverage was an easy process tended to choose Medicare Advantage coverage.