I have been a health insurance broker for over 10 years and every day I read more and much more “horror” stories that are posted on the Internet regarding health insurance companies not spending claims, refusing to cover specific health problems and physicians not getting reimbursed for medical services. Unfortunately, insurance firms are driven by profits, not people (albeit they need people to create profits). If the insurance company can find the best reason not to pay a state, chances are they will find it, and you the consumer will suffer. However , what most people fail to realize is that there are very few “loopholes” in an insurance policy that give the insurance firm an unfair advantage over the customer. In fact , insurance companies go to great lengths to detail the limitations of the coverage by giving the policy holders 10-days (a 10-day free look period) to review their policy. Unfortunately, a lot of people put their insurance cards within their wallet and place their policy in the drawer or filing cabinet during their 10-day free look and it usually isn’t until they receive a “denial” letter from the insurance company that they consider their policy out to really go through it.
The majority of people, who buy their own health insurance, rely heavily on the insurance agent selling the policy to explain the plan’s coverage and benefits.
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This particular being the case, many individuals who purchase their own health insurance plan can tell a person very little about their plan, besides, what they pay in premiums and how much they have to pay to satisfy their own deductible.
For many consumers, purchasing a health insurance policy on their own can be an enormous executing. Purchasing a health insurance policy is not like buying a car, in that, the buyer knows that the engine and transmission are usually standard, and that power windows are optional. A health insurance plan is much more ambiguous, and it is often very difficult for the consumer to determine what type of coverage will be standard and what other benefits are optional. In my opinion, this is the primary cause that most policy holders don’t realize that they do not possess coverage for a specific medical treatment until they receive a large bill from the hospital stating that “benefits were denied. ”
Sure, we all make a complaint about insurance companies, but we can say for certain that they serve a “necessary bad. ” And, even though purchasing health insurance may be a frustrating, daunting and time consuming task, there are certain things that you can do as a consumer to ensure that you are purchasing the kind of health insurance coverage you really need at a fair price.
Dealing with small business owners as well as the self-employed market, I have come to the particular realization that it is extremely difficult for individuals to distinguish between the type of health insurance coverage that they “want” and the benefits they will really “need. ” Recently, I have read various comments on various Blogs advocating health plans that provide 100% coverage (no deductible plus no-coinsurance) and, although I agree that those types of plans have an excellent “curb appeal, ” I can tell you from personal experience that these plans are not for everyone. Perform 100% health plans offer the policy holder greater peace of mind? Probably. But is a 100% health insurance plan something that most consumers really need? Probably not! In my expert opinion, when you purchase a health insurance plan, you must achieve a balance between four important variables; wants, needs, danger and price. Just like you would perform if you were purchasing options for a brand new car, you have to weigh all these factors before you spend your money. If you are healthy, take no medications and seldom go to the doctor, do you really need a completely plan with a $5 co-payment for prescription drugs if it costs you $300 dollars more a month?
Is it really worth $200 more a month to have a $250 deductible and a $20 brand name/$10 generic Rx co-pay versus an 80/20 plan with a $2, 500 deductible that also offers a 20 dollars brand name/$10generic co-pay after you pay out an once a year $100 Rx insurance deductible? Wouldn’t the 80/20 plan nevertheless offer you adequate coverage? Don’t you think it would be better to put that additional $200 ($2, 400 per year) in your bank account, just in case you may have to pay your $2, 500 deductible or even buy a $12 Amoxicillin prescription? Just isn’t it wiser to keep your hard-earned money rather than pay higher monthly premiums to an insurance company?
Yes, there are many methods for you to keep more of the money that you would certainly normally give to an insurance company in the form of higher monthly premiums. For example , the us government encourages consumers to purchase H. S. A. (Health Savings Account) certified H. D. H. P. is (High Deductible Health Plans) so they have more control over how their health care dollars are spent. Consumers who also purchase an HSA Qualified They would. D. H. P. can put extra money aside each year in an attention bearing account so they can use that money to pay for out-of-pocket medical expenses. Even procedures that are not normally covered by insurance companies, like Lasik eyes surgery, orthodontics, and alternative medications become 100% tax deductible. In case there are no claims that year the money that was deposited into the tax deferred H. S. A could be rolled over to the next year getting an even higher rate of interest. If there are no significant claims for several years (as is often the case) the covered ends up building a sizeable account that enjoys similar tax benefits being a traditional I. R. A. Most H. S. A. administrators now offer thousands of no load shared funds to transfer your H. S. A. funds into so that you can potentially earn an even higher interest rate.
In my experience, I believe that individuals who purchase their health plan based on desires rather than needs feel the most defrauded or “ripped-off” by their insurance company and insurance agent. In fact , I hear nearly identical comments from almost every company leader that I speak to. Comments, such as, “I have to run my business, I don’t have time to be sick! “I think I have gone to the doctor twice in the last 5 years” and “My insurance company keeps raising my prices and I don’t even use my insurance! ” As a business owner myself, I could understand their frustration. So , can there be a simple formula that everyone can follow to make health insurance buying easier? Yes! Become an INFORMED consumer.
Each time I contact a prospective client or call one of my client referrals, I ask a handful of specific questions that directly relate to the plan that particular individual currently has within their filing cabinet or dresser drawer. You know the policy that they bought to protect them from having to document bankruptcy due to medical debt. That will policy they purchased to cover that $500, 000 life-saving organ transplant or those 40 chemotherapy remedies that they may have to undergo if they are diagnosed with cancer.
So what do you think happens almost 100% of the time when I ask these individuals “BASIC” questions about their health insurance policy? They do not know the answers! The next is a list of 10 questions which i frequently ask a prospective health insurance client. Let’s see how many YOU can answer without looking at your policy.
1 . What Insurance Company are you insured with and what is the name of your health insurance plan? (e. g. Azure Cross Blue Shield-“Basic Blue”)
2 . What is your calendar year deductible and would you have to pay a separate deductible for each family member if everyone in your family members became ill at the same time? (e. gary the gadget guy. The majority of health plans have a per person yearly deductible, for example , $250, $500, $1, 000, or $2, 500. However , some plans is only going to require you to pay a 2 person maximum deductible each year, even if everyone in your family needed extensive medical care. )
3. What is your coinsurance percentage and what dollar amount (stop loss) it is based on? (e. g. A good plan with 80/20 insurance means you pay 20% of some dollar amount. This buck amount is also known as a stop loss and can vary based on the type of policy you purchase. Stop losses can be as little as $5, 000 or 10 dollars, 000 or as much as $20, 500 or there are some policies on the market which have NO stop loss dollar amount. )
4. What is your optimum out of pocket expense per year? (e. g. All deductibles plus all coinsurance percentages plus all relevant access fees or other fees)
5. What is the Lifetime maximum benefit the company will pay if you become seriously ill and does your plan have any “per illness” maximums or caps? (e. g. Some plans may have a $5 million life time maximum, but may have an obtain the most cap of $100, 000 per illness. This means that you would have to create many separate and unrelated life-threatening illnesses costing $100, 000 or less to qualify for $5 million of lifetime coverage. )
six. Is your plan a schedule strategy, in that it only pays a certain amount for a specific list of procedures? (e. g., Mega Life & Wellness & Midwest National Life, recommended by the National Association of the A sole proprietor, N. A. S. E. is known for endorsing schedule plans) seven. Does your plan have doctor co-pays and are you limited to a certain variety of doctor co-pay visits per year? (e. g. Many plans have a restrict of how many times you go to the doctor per year for a co-pay and, quite often the particular limit is 2-4 visits. )
8. Does your plan offer prescription drug coverage and if it does, do you pay a co-pay for your prescription medications or do you have to meet a separate medication deductible before you receive any benefits and/or do you just have a low cost prescription card only? (e. g. Some plans offer you prescription benefits right away, other plans require that you simply pay a separate drug deductible before you receive prescription medication for a co-pay. Nowadays, many plans offer no co-pay options and only provide you with a discount doctor prescribed card that gives you a 10-20% discounted on all prescription medications).
nine. Does your plan have any decrease in benefits for organ transplants and if so , what is the maximum your program will pay if you need an organ transplant? (e. g. Some plans only pay a $100, 000 maximum benefit for organ transplants for a procedure that actually costs $350-$500K and this $100, 000 maximum may also include reimbursement intended for expensive anti-rejection medications that must be taken after a transplant. If this is the situation, you will often have to pay for all anti-rejection medications out of pocket).
10. Do you have to pay a separate deductible or “access fee” for each hospital admission or for each emergency room visit? (e. g. Some plans, like the Assurant Health’s “CoreMed” plan have a separate $750 hospital admission fee that you pay money for the first 3 days you are within the hospital. This fee is in addition to your plan deductible. Also, a lot of plans have benefit “caps” or “access fees” for out-patient providers, such as, physical therapy, speech treatment, chemotherapy, radiation therapy, etc . Benefit “caps” could be as little as $500 for every out-patient treatment, leaving you a bill for the remaining balance. Access fees are additional fees that you pay for each treatment. For example , for each outpatient chemotherapy treatment, you may be required to pay the $250 “access fee” per treatment. So for 40 chemotherapy treatments, you would have to pay 40 x $250 = $10, 000. Again, these fees would be charged in addition to your plan deductible).
Now that you’ve go through the list of questions that I ask a prospective health insurance client, ask yourself how many questions you were able to solution. If you couldn’t answer all ten questions don’t be discouraged. That doesn’t mean that you are not a smart consumer. It may just mean that you dealt with a “bad” insurance agent. So how could you tell if you dealt with a “bad” insurance agent? Just because a “great” insurance agent would have taken you a chance to help you really understand your insurance plan benefits. A “great” agent usually spends time asking YOU questions so s/he can understand your insurance requirements. A “great” agent recommends wellness plans based on all four variables; wants, needs, risk and price. A “great” agent gives you enough info to weigh all of your options so you can make an informed purchasing decision. And lastly, the “great” agent looks out for Your very best interest and NOT the best interest from the insurance company.
So how do you know if you have the “great” agent? Easy, if you could answer all 10 questions without looking at your health insurance policy, you have a “great” agent. If you were able to answer nearly all questions, you may have a “good” real estate agent. However , if you were only able to answer a few questions, chances are you have a “bad” agent. Insurance agents are no different than any other professional. There are some insurance agents that really care about the customers they work with, and there are other providers that avoid answering questions and duck client phone calls when a message is left about unpaid states or skyrocketing health insurance rates.