I have been a insurance broker for over a decade and each day I read more and more “horror” stories that are posted on the web regarding insurance companies not paying claims, refusing to hide specific illnesses and physicians not getting reimbursed for medical services. Unfortunately, insurance companies are driven by profits, not people (albeit they have people to form profits). If the insurance firm can find a legal reason to not pay a claim, likelihood is that they’re going to find it, and you the buyer will suffer. However, what most of the people fail to understand is that there are only a few “loopholes” in an policy that give the insurance firm an unfair advantage over the buyer . In fact, insurance companies attend great lengths to detail the restrictions of their coverage by giving the policy holders 10-days (a 10-day free look period) to review their policy. Unfortunately, most of the people put their insurance cards in their wallet and place their policy during a drawer or file during their 10-day free look and it always isn’t until they receive a “denial” letter from the insurance firm that they take their policy bent really read through it.
The majority of individuals , who buy their own insurance , rely heavily on the insurance broker selling the policy to elucidate the plan’s coverage and benefits. This being the case, many individuals who purchase their own insurance plan can tell you little or no about their plan, aside from , what they pay in premiums and the way much they need to pay to satisfy their deductible.
For many consumers, purchasing a insurance policy on their own are often a huge undertaking. Purchasing a insurance policy isn’t like buying a car, in that, the customer knows that the engine and transmission are standard, which power windows are optional. A insurance plan is far more ambiguous, and it’s often very difficult for the buyer to work out what sort of coverage is standard and what other benefits are optional. In my opinion, this is often the first reason that the majority policy holders do not realize that they are doing not have coverage for a selected medical treatment until they receive an outsized bill from the hospital stating that “benefits were denied.”
Sure, we all complain about insurance companies, but we do know that they serve a “necessary evil.” And, albeit purchasing insurance could also be a frustrating, daunting and time consuming task, there are certain things that you simply simply can do as a consumer to make sure that you are purchasing the sort of insurance coverage you actually need at a good price.
Dealing with small business owners and therefore the self-employed market, I even have come to the belief that it’s extremely difficult for people to differentiate between the sort of insurance coverage that they “want” and therefore the benefits they really “need.” Recently, I even have read various comments on different Blogs advocating health plans that provide 100% coverage (no deductible and no-coinsurance) and, although I agree that those sorts of plans have an excellent “curb appeal,” I can tell you from personal experience that these plans aren’t for everybody . Do 100% health plans offer the policy holder greater peace of mind? Probably. But may be a 100% insurance plan something that the majority consumers really need? Probably not! In my professional opinion, once you purchase a insurance plan, you want to achieve a balance between four important variables; wants, needs, risk and price. a bit like you’d do if you were purchasing options for a replacement car, you’ve got to weigh of these variables before you spend your money. If you’re healthy, take no medications and infrequently attend the doctor, does one actually need a 100% plan with a $5 co-payment for prescribed drugs if it costs you $300 dollars more a month?
Is it worth $200 more a month to possess 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 brand name/$10generic co-pay after you pay a once a year $100 Rx deductible? Wouldn’t the 80/20 plan still provide you with adequate coverage? Don’t you think that it might be better to place that extra $200 ($2,400 per year) in your checking account , just just in case you’ll need to pay your $2,500 deductible or buy a $12 Amoxicillin prescription? Isn’t it wiser to stay your hard-earned money instead of pay higher premiums to an insurance company?
Yes, there are some ways you’ll keep more of the cash that you simply would normally give to an insurance firm within the sort of higher monthly premiums. for instance , the federal encourages consumers to get H.S.A. (Health Savings Account) qualified H.D.H.P.’s (High Deductible Health Plans) in order that they have more control over how their health care dollars are spent. Consumers who purchase an HSA Qualified H.D.H.P. can put extra cash aside annually in an interest bearing account in order that they can use that cash to buy out-of-pocket medical expenses. Even procedures that aren’t normally covered by insurance companies, like Lasik eye surgery, orthodontics, and alternative medicines become 100% tax deductible. If there are not any claims that year the cash that was deposited into the tax deferred H.S.A are often rolled over to subsequent year earning a good higher rate of interest. If there are not any significant claims for several years (as is usually the case) the insured finishes up building a sizeable account that enjoys similar tax benefits as a standard I.R.A. Most H.S.A. administrators now offer thousands of no load mutual funds to transfer your H.S.A. funds into so you’ll potentially earn a good higher rate of interest.
In my experience, i think that individuals who purchase their health plan supported wants instead of needs feel the foremost defrauded or “ripped-off” by their insurance firm and/or insurance broker . In fact, I hear almost identical comments from almost every business owner that I speak to. Comments, such as, “I need to run my business, i do not have time to be sick! “I think I even have gone to the doctor 2 times within the last 5 years” and “My insurance firm keeps raising my rates and that i don’t even use my insurance!” As a business owner myself, I can understand their frustration. So, is there an easy formula that everybody can follow to form insurance buying easier? Yes! Become an INFORMED consumer.
Every time I contact a prospective client or call one among my client referrals, I ask a couple of specific questions that directly relate to the policy that specific individual currently has in their file or dresser drawer. you recognize the policy that they bought to guard them from having to file bankruptcy thanks to medical debt. That policy they purchased to hide that $500,000 life-saving transplant or those 40 chemotherapy treatments that they’ll need to undergo if they’re diagnosed with cancer.
So what does one think happens almost 100% of the time once I ask these individuals “BASIC” questions on their insurance policy? they are doing not know the answers! the subsequent may be a list of 10 questions that I frequently ask a prospective insurance client. let’s examine what percentage you’ll answer without watching your policy.
1. What insurance firm are you insured with and what’s the name of your insurance plan? (e.g. Blue Cross Blue Shield-“Basic Blue”)
2. what’s your civil year deductible and would you’ve got to pay a separate deductible for every loved one if everyone in your family became ill at an equivalent time? (e.g. the bulk of health plans have a per person yearly deductible, for instance , $250, $500, $1,000, or $2,500. However, some plans will only require you to pay a 2 person maximum deductible annually , albeit everyone in your family needed extensive medical aid .)
3. what’s your coinsurance percentage and what dollar amount (stop loss) it’s based on? (e.g. an honest plan with 80/20 coverage means you pay 20% of some dollar amount. This dollar amount is additionally referred to as a stop loss and may vary supported the sort of policy you buy . Stop losses are often as little as $5,000 or $10,000 or the maximum amount as $20,000 or there are some policies on the market that haven’t any stop loss dollar amount.)
4. what’s your maximum out of pocket expense per year? (e.g. All deductibles plus all coinsurance percentages plus all applicable access fees or other fees)
5. what’s the Lifetime maximum benefit the insurance firm can 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 lifetime maximum, but may have a maximum benefit cap of $100,000 per illness. this suggests that you simply would need to develop many separate and unrelated life-threatening illnesses costing $100,000 or less to qualify for $5 million of lifetime coverage.)
6. Is your plan a schedule plan, therein it only pays a particular amount for a selected 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 understood for endorsing schedule plans) 7. Does your plan have doctor co-pays and are you limited to a particular number of doctor co-pay visits per year? (e.g. Many plans have a limit of what percentage times you attend the doctor per annum for a co-pay and, very often the limit is 2-4 visits.)
8. Does your plan offer prescription coverage and if it does, does one pay a co-pay for your prescriptions or does one need to meet a separate drug deductible before you receive any benefits and/or does one just have a reduction prescription card only? (e.g. Some plans provide you with prescription benefits directly , other plans require that you simply pay a separate drug deductible before you’ll receive prescription medication for a co-pay. Today, many plans offer no co-pay options and only provide you with a reduction prescription card that provides 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’s the utmost your plan can pay if you would like an organ transplant? (e.g. Some plans only pay a $100,000 maximum benefit for organ transplants for a procedure that really costs $350-$500K and this $100,000 maximum can also include reimbursement for expensive anti-rejection medications that has got to be taken after a transplant. If this is often the case, you’ll often need to buy all anti-rejection medications out of pocket).
10. does one need to pay a separate deductible or “access fee” for every hospital admission or for every ER visit? (e.g. Some plans, just like the Assurant Health’s “CoreMed” plan have a separate $750 hospital entrance fee that you simply buy the primary 3 days you’re within the hospital. This fee is additionally to your plan deductible. Also, many plans have benefit “caps” or “access fees” for out-patient services, such as, physiotherapy , therapy , chemotherapy, radiotherapy , etc. Benefit “caps” might 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 simply pay per treatment. for instance , for every outpatient chemotherapy treatment, you’ll be required to pay a $250 “access fee” per treatment. So for 40 chemotherapy treatments, you’d need to pay 40 x $250 = $10,000. Again, these fees would be charged additionally to your plan deductible).