I have already been a health insurance broker for over a decade and every day I read more and much more “horror” stories that are posted on the Internet regarding health insurance companies not paying claims, refusing to cover specific health problems and physicians not getting reimbursed for medical services. Unfortunately, insurance providers are driven by profits, not people (albeit they need people to make profits).
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If the insurance company can find a legal reason not to pay a state, chances are they will find it, and you the customer will suffer. However , what most people fail to realize is that there are very few “loopholes” in an insurance policy that give the insurance organization an unfair advantage over the customer. In fact , insurance companies go to great measures 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, most people put their insurance cards in their wallet and place their policy inside a 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 particular plan’s coverage and benefits. This particular 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 exactly 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 reason that most policy holders don’t realize that they have no coverage for a specific medical treatment until they receive a large bill in the hospital stating that “benefits had been denied. ”
Sure, we all make a complaint about insurance companies, but we can say for certain that they serve a “necessary wicked. ” And, even though purchasing health insurance may be a frustrating, daunting and time intensive 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 in 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 individuals to distinguish between the type of health insurance insurance that they “want” and the benefits they 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 an excellent “curb appeal, ” I can tell you therefore that these plans are not for everyone. Perform 100% health plans offer the client greater peace of mind? Probably. But is really a 100% health insurance plan something that the majority of consumers really need? Probably not! In my expert 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 perform if you were purchasing options for a new car, you have to weigh all these factors before you spend your money. If you are healthful, take no medications and hardly ever go to the doctor, do you really need a 100% plan with a $5 co-payment for prescription drugs if it costs you $300 dollars more a month?
Is it 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, five hundred deductible that also offers a 20 dollars brand name/$10generic co-pay after you spend 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 spend 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 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) skilled H. D. H. P. ‘s (High Deductible Health Plans) so they have more control over how their health care dollars are spent. Consumers which 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 will money to pay for out-of-pocket medical expenditures. Even procedures that are not usually covered by insurance companies, like Lasik vision surgery, orthodontics, and alternative medicines become 100% tax deductible. In the event that 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 getting an even higher rate of interest. If you can find no significant claims for several years (as is often the case) the insured ends up building a sizeable account that will enjoys similar tax benefits as being a traditional I. R. A. Most H. S. A. administrators at this point offer thousands of no load shared funds to transfer your L. 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 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 actually 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 can understand their frustration. So , is there a simple formula that everyone can follow to make health insurance buying easier? Yes! Become an INFORMED consumer.
Every time I contact a prospective client or call one of my client recommendations, I ask a handful of specific questions that directly relate to the plan that particular individual currently has within their filing cabinet or dresser cabinet. 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 hair 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 they “BASIC” questions about their medical health insurance policy? They do not know the answers! The following is a list of 10 questions which i frequently ask a prospective health insurance client. Let’s see how many You are able to answer without looking at your policy.
1 . What Insurance Company are you covered with and what is the name of your health insurance plan? (e. g. Glowing blue Cross Blue Shield-“Basic Blue”)
second . 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 for each 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 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 coverage means you pay 20% associated with 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, 000 or as much as $20, 1000 or there are some policies on the market which have NO stop loss dollar quantity. )
4. What is your optimum out of pocket expense per year? (e. g. All deductibles plus just about all coinsurance percentages plus all applicable access fees or other fees)
5. What is the Lifetime maximum benefit the company will pay if you become significantly ill and does your plan possess any “per illness” maximums or even caps? (e. g. Some programs may have a $5 million lifetime maximum, but may have a maximum benefit cap of $100, 000 for each 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 mil of lifetime coverage. )
6. Is your plan a schedule strategy, in that it only pays a certain amount for a specific list of procedures? (e. g., Mega Life & Health & Midwest National Life, recommended by the National Association of the A sole proprietor, N. A. S. E. is known for endorsing schedule plans) 7. Does your plan have doctor co-pays and are you limited to a certain quantity of doctor co-pay visits per year? (e. g. Many plans have a limit 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 doctor prescribed drug coverage and if it does, would you pay a co-pay for your prescription medications or do you have to meet a separate medication deductible before you receive any advantages and/or do you just have a price cut prescription card only? (e. gary the gadget guy. Some plans offer you prescription advantages right away, other plans require that you simply pay a separate drug deductible before you can receive prescription medication for a co-pay. These days, many plans offer no co-pay options and only provide you with a discount prescription 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 when so , what is the maximum your plan will pay if you need an organ transplant? (e. g. Some plans just pay a $100, 000 maximum benefit intended for organ transplants for a procedure that actually costs $350-$500K and this $100, 000 maximum may also include reimbursement for expensive anti-rejection medications that must be used after a transplant. If this is the case, you will often have to pay for all anti-rejection medications out of pocket).
10. Is it necessary to pay a separate deductible or “access fee” for each hospital admission or even 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 pay for the first 3 days you are in the hospital. This fee is in conjunction with your plan deductible. Also, a lot of plans have benefit “caps” or “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 each 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 remedies, you would have to pay 40 x $250 = $10, 000. Again, these types of fees would be charged in addition to your own plan deductible).
Now that you’ve read through the list of questions that I ask a prospective health insurance client, consider how many questions you were able to solution. If you couldn’t answer all 10 questions don’t be discouraged. That doesn’t imply 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 benefits. A “great” agent 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 a “great” agent? Easy, if you were able to 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” real estate agent. However , if you were only capable of answer a few questions, chances are you have a “bad” agent. Insurance agents are simply no different than any other professional. There are some insurance policy agents that really care about the clients they work with, and there are other agents that avoid answering questions and duck client phone calls when a message is left about unpaid claims or skyrocketing health insurance rates.
Remember, your health insurance purchase is just as important as purchasing a house or a vehicle, if not more important. So don’t be scared to ask your insurance agent plenty of questions to make sure that you understand what your wellbeing plan does and does not cover. Should you do not feel comfortable with the type of coverage that your agent suggests or if you think the price is too high, ask your broker if s/he can select an equivalent plan so you can make a side by side evaluation before you purchase. And, most importantly, read through all of the “fine print” in your health plan brochure and when you receive your own policy, take the time to read through your policy during your 10-day free look time period.
If you can’t understand something, or usually are quite sure what the asterisk (*) next to the benefit description really means in terms of your coverage, call your own agent or contact the insurance business to ask for further clarification.
Furthermore, take time to perform your own due diligence. For example , in case you research MEGA Life and Health or the Midwest National Life insurance business, endorsed by the National Association for the Self Employed (NASE), you will find that there have been fourteen class action lawsuits brought towards these companies since 1995. So ask yourself, “Is this a company that I might trust to pay my health insurance statements?
Additionally , find out if your agent is a “captive” agent or an insurance plan “broker. ” “Captive” agents can only offer ONE insurance company’s items. ” Independent” agents or insurance policy “brokers” can offer you a variety of various insurance plans from many different insurance companies. A “captive” agent may recommend the health plan that doesn’t exactly suit your needs because that is the only plan s/he can sell. An “independent” realtor or insurance “broker” can usually offer you a variety of different insurance products from many quality carriers and can often customize a plan to meet your specific insurance needs and budget.
Through the years, I have developed strong, trusting relationships with my clients because of the insurance expertise and the level of personal service that I provide. This is among the primary reasons that I do not suggest buying health insurance on the Internet. In my opinion, you will find too many variables that Internet insurance coverage buyers do not often take into consideration. We are a firm believer that a health insurance purchase requires the level of expertise and personal interest that only an insurance professional can provide. And, since it does not cost a cent more to purchase your health insurance through an realtor or broker, my advice would be to use eBay and Amazon for the less important purchases and to use a knowledgeable, ethical and reputable independent agent or broker for one of the most important purchases you will ever create…. your health insurance policy.
Lastly, if you have any kind of concerns about an insurance company, contact your state’s Department of Insurance plan BEFORE you buy your policy. Your california’s Department of Insurance can tell you if the insurance company is registered in your state and can also tell you in case there have been any complaints against that company that have been filed by policy holders. If you suspect that your agent is trying to sell you a fraudulent insurance policy, (e. g. you have to become a member of an union to qualify for coverage) or basically being honest with you, your california’s Department of Insurance can also check to see if your agent is licensed and whether or not there has ever been any disciplinary action previously taken against that agent.
In closing, I hope I have provided you with enough information so you can become the best insurance consumer. However , I stay convinced that the following words associated with wisdom still go along way: “If it sounds too good to be genuine, it probably is! ” plus “If you only buy on cost, you get what you pay for! “