I have been a health insurance broker for over ten years and every day I read more and more “horror” stories that are posted on the Internet regarding health insurance companies not paying claims, refusing to cover specific ailments and physicians not getting reimbursed for medical services. Unfortunately, insurance companies are driven by profits, not people (albeit they need people to make profits). If the insurance company can find the best reason not to pay a declare, chances are they will find it, and you the customer will suffer. However , what most people neglect 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 their coverage by giving the policy holders 10-days (a 10-day free look period) to review their policy. Unfortunately, many people put their insurance cards within their wallet and place their policy in the drawer or filing cabinet throughout their 10-day free look and it usually isn’t until they receive a “denial” letter from the insurance company that they take 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 particular plan’s coverage and benefits. This being the case, many individuals who buy their own health insurance plan can tell a person very little about their plan, apart from, what they pay in premiums and how much they have to pay to satisfy their deductible.
For many consumers, purchasing a health insurance policy on their own can be an enormous undertaking. Purchasing a health insurance policy is not like buying a car, in that, the buyer sees that the engine and transmission are standard, and that power windows are optional. A health insurance plan is much more ambiguous, and it is often very difficult for your consumer to determine what type of coverage can 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 don¡¯t have coverage for a specific medical treatment till they receive a large bill from the hospital stating that “benefits were denied. ”
Sure, we all make a complaint about insurance companies, but we do know that they serve a “necessary evil. ” And, even though purchasing medical health insurance may be a frustrating, daunting and time consuming task, there are certain things that you can do like 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 and the self-employed market, I have come to the particular realization that it is extremely difficult for people to distinguish between the type of health insurance protection that they “want” and the benefits these people really “need. ” Recently, I have read various comments on different Blogs advocating health plans that provide 100% coverage (no deductible plus no-coinsurance) and, although I agree that those types of plans have a great “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 many consumers really need? Probably not! In my professional opinion, when you purchase a health insurance strategy, you must achieve a balance between 4 important variables; wants, needs, danger and price. Just like you would do 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 regarding 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 a good 80/20 plan with a $2, 500 deductible that also offers a 20 dollars brand name/$10generic co-pay after you spend an once a year $100 Rx deductible? Wouldn’t the 80/20 plan nevertheless offer you adequate coverage? Don’t you believe it would be better to put that extra $200 ($2, 400 per year) in your bank account, just in case you may have to pay out your $2, 500 deductible or buy a $12 Amoxicillin prescription? Just isn’t it wiser to keep your hard-earned money rather than pay higher rates to an insurance company?
Yes, there are many ways you can keep more of the money that you would normally give to an insurance company in the form of higher monthly premiums. For example , the us government encourages consumers to purchase H.
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S. A. (Health Savings Account) competent H. D. H. P. is (High Deductible Health Plans) so they have more control over how their healthcare dollars are spent. Consumers who else purchase an HSA Qualified H. 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 expenditures. Even procedures that are not normally covered by insurance companies, like Lasik attention surgery, orthodontics, and alternative medications become 100% tax deductible. In case there are no claims that season the money that was deposited into the tax deferred H. S. A could be rolled over to the next year earning 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 will enjoys similar tax benefits like a traditional I. R. A. The majority of H. S. A. administrators right now offer thousands of no load shared funds to transfer your They would. S. A. funds into so you can potentially earn an even higher interest rate.
In my experience, I believe that individuals who purchase their health plan based on wants rather than needs feel the most defrauded or “ripped-off” by their insurance company and/or 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 plan! ” As a business owner myself, I could understand their frustration. So , is there a simple formula that everyone can follow to make health insurance buying simpler? Yes! Become an INFORMED consumer.
Every time I contact a prospective client or even call one of my client referrals, I ask a handful of specific queries that directly relate to the policy that particular individual currently has in their filing cabinet or dresser drawer. You know the policy that they bought to protect them from having to file bankruptcy due to medical debt. That policy they purchased to cover that $500, 000 life-saving organ transplant or those 40 chemotherapy treatments that they may have to undergo if they are diagnosed with cancer.
So what do you think happens nearly 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 the health insurance plan? (e. g. Azure Cross Blue Shield-“Basic Blue”)
second . What is your calendar year deductible and would you have to pay a separate deductible for every family member if everyone in your loved ones became ill at the same time? (e. g. 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 individual maximum deductible each year, even if everyone in your family needed extensive health care. )
3. What is your coinsurance percentage and what dollar amount (stop loss) it is based on? (e. gary the gadget guy. A good plan with 80/20 coverage means you pay 20% of some dollar amount. This money amount is also known as a stop reduction 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, 000 or there are some policies on the market that 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 appropriate access fees or other fees)
5. What is the Lifetime maximum benefit the insurance company will pay if you become significantly ill and does your plan have any “per illness” maximums or even caps? (e. g. Some plans may have a $5 million life time maximum, but may have a maximum benefit cap of $100, 000 per illness. This means that you would have to develop 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 program, in that it only pays a specific amount for a specific list of procedures? (e. g., Mega Life & Health & Midwest National Life, endorsed by the National Association of the Self-Employed, N. A. S. E. is well known for endorsing schedule plans) seven. Does your plan have doctor co-pays and are you limited to a certain amount 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 limit is 2-4 visits. )
8. Does your plan offer prescription drug coverage and if it does, would you pay a co-pay for your prescription medications or do you have to meet a separate drug deductible before you receive any advantages and/or do you just have a lower price 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% discount on all prescription medications).
9. Does your plan have any reduction in benefits for organ transplants and if so , what is the maximum your plan will pay if you need an organ hair transplant? (e. g. Some plans just pay a $100, 000 maximum benefit with regard to organ transplants for a procedure that truly costs $350-$500K and this $100, 1000 maximum may also include reimbursement to get expensive anti-rejection medications that must be used 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. gary the gadget guy. Some plans, like the Assurant Health’s “CoreMed” plan have a separate $750 hospital admission fee that you spend on 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 even “access fees” for out-patient solutions, 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 that remaining balance. Access fees are additional fees that you pay per treatment. For example , for each outpatient chemotherapy treatment, you may be required to pay a $250 “access fee” per therapy. So for 40 chemotherapy remedies, you would have to pay 40 x $250 = $10, 000. Again, these types of fees would be charged in addition to your plan deductible).
Now that you’ve read through the list of questions that I request a prospective health insurance client, consider how many questions you were able to answer. If you couldn’t answer all 10 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? Because a “great” insurance agent would have taken you a chance to help you really understand your insurance policy benefits. A “great” agent usually spends time asking YOU questions so s/he can understand your insurance needs. A “great” agent recommends health 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, a “great” agent looks out for Your very best interest and NOT the best interest of the insurance company.
So how do you know if you have the “great” agent? Easy, if you could answer all 10 questions with no looking at your health insurance policy, you have a “great” agent. If you were able to answer the majority of questions, you may have a “good” agent. However , if you were only in a position 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 policy agents that really care about the customers they work with, and there are other providers that avoid answering questions plus duck client phone calls when an information is left about unpaid statements or skyrocketing health insurance rates.