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Health Insurance - Frequently Asked Questions

Frequently Asked Questions

What types of health plans can I choose from?

The most common types of health plans are fee for service and managed care. There are various types of managed care plans, including:

  • Health Management Organization (HMO) plans
  • Preferred Provider Organization (PPO) plans
  • Point-of-Service (POS) plans

 

What does Fee for Service mean?

Fee for service or indemnity health plans are the traditional type of health policies. Your health insurer will pay a portion of your medical costs. You are responsible to pay your deductible before the insurer will pay their portion. You are also responsible for paying the monthly bill for your policy, called the premium.


What are HMO plans?

A Health Management Organization or HMO plan is one which requires that you select a primary care physician (PCP). HMO's contain costs by managing care through these primary care physicians. One must seek a referral from their PCP prior to seeing a specialist. Care sought out of network, and without a referral may not be covered or will be covered at a substantially reduced rate by an HMO plan.


What are PPO plans?

A Preferred Provider Organization, or PPO, combines fee-for-service plan and HMO plans. By being limited in what doctors and hospitals you choose, more of your medical costs will be covered. Although you can choose a doctor or hospital outside of the plan if you're willing to have less of the expenses covered.

 

QuestionsWhat are POS plans?

A Point-of-Service, or POS plan, gives you options in either choosing services in-network or out-of-network. You usually have to pay more money for out-of-network medical services.

 

What plan should I choose?

Each type of plan has its own Pros and Cons. The plan you need is based on your own unique situation. An experienced, licensed agent is recommended to help you navigate the plans to find the best one for you.

 

Will my plan pay everything the Doctor or Hospital charge?

Your plan will pay any reasonable and customary charge for the medical service after you have paid your portion of your deductible and co-insurance. Plans vary in deductibles, co-insurance, co-pays and more; be sure to understand your plan before you purchase insurance and incur charges for care.

 

What Doctors can I see? Can I see my own?

In a Fee for Service plan you may generally choose your own doctor. More likely your plan offers you choices of doctors and hospitals in a set network. Many PPOs and HMOs will allow you to visit a doctor or hospital out of network but you will have less of your expenses covered.


What is a and Who is my Primary Care Physician?

A primary care physician, or PCP, is the central doctor responsible for your medical care. Many health plans require you to have a primary care physician for any type of medical service. Your PCP will see you for your routine and first care visits. Your PCP will then coordinate your health care and assign any specialists that you require. If you do not have a PCP you can choose one from the network provided by your plan.


How do I know if a health care plan is right for me?

Finding the right health plan is not the same for everyone. The first step is to evaluate your situation and determine what your medical needs or what you think they may be. Then find a few plans that meet your basic criteria and find out what each plan will cover. You should note and learn any limitations in the plans. Compare and contrast not only the coverage and costs of each plan, but also the gaps and limitations. The lower premium will often cost you much more if major illness or sickness were to occur so be sure to fully understand the entire plan. An experienced and licensed insurance agent is a great resource to help you accomplish this task.


What is Preventive care and is it covered under all plans?

Preventive care is about sustaining good health and finding any medical issues early to help stop any major issues before they start. Most health care plans cover preventative care visits, such as immunizations, routine physicals and mammograms.


Do I qualify for Group or Individual coverage?

If your employer offers insurance coverage then you would qualify for their group coverage. This insurance can usually be offered at a lower rate since it covers a large number of people. On the other hand if your employer does not offer insurance coverage then individual insurance is what you would qualify for. This means you are on your own to find and pay for a plan that fits your needs.


Can I, or my spouse and I, collect on more than one policy?

Yes, but typically the benefits will not exceed more than 100% of the expense. You can enroll in a limited benefit policy in addition to major medical or as a standalone product. This type of plan will pay you a fixed cash amount based on a specific occurrence, such a overnight hospital stay or ambulance ride, regardless of the total expense. This benefit may pay you more or less than the expense incurred.


What does “Free Look” mean and what protection does it offer me?

Most insurance plan will contain “Free Look” period. This means that you can enroll, receive and review the policy and cancel without penalty within a certain number of days. The “Free Look” period protects you in case the policy does not meet your needs or expectations of what you believed the plan would cover. This “Free Look” period is often guaranteed by law.


Is my employer required to provide me health coverage?

Not yet, but on Jan 1 2014 the Affordable Care Act will require large employers to provide coverage to full-time employees or pay a penalty. This is called the “Pay or Play” rule. Companies with 50 or fewer employees are exempt from this rule.


What’s the difference between Prescription Insurance and Prescription Discount Coverage?

There are two basic yet very different types of drug plans: prescription discount and prescription insurance.

A discount plan will typically charge you a monthly or annual fee and send you a discount card. You present your card when you fill a prescription, and the pharmacy gives you a certain percentage off the cost of the drug. The discount may vary drug by drug or by brands versus generics. THIS IS NOT INSURANCE. Discount plans are typically sold by drug manufacturers, drug stores and membership organizations.

Prescription insurance is similar to your major medical insurance. You pay a premium, and then you pay a co pay when you fill a prescription. Prescription drug coverage may be a stand-alone plan or integrated with your medical insurance. In the individual market, you’re most likely to find prescription insurance bundled with health insurance.


Should I choose name brand or generic brand drugs? Is there any danger in generic?

First of all, there is no danger in taking a generic drug over the name brand. The FDA requires that the active ingredient, strength and quality in generic drugs be the same as their name brand counterparts.

Name brand drugs are often the first to market drug and are higher cost as the drug makers recoup the costs of the research and development of their drug. This time period is often protected by a patent filed by the drug maker for their drug. Once that patent expires other drug makers are free to create the same drug and sell at a lower rate as they do not have the original expenses for development to recoup.

Approximately 70% of all drugs sold in the USA are generic drugs. Often times a month’s supply of a generic drug can be over $100 less than its name brand counterpart. Prescription insurance coverage will most likely offer lower co pays for generic brands as opposed to name brands.

When you doctor writes you a prescription, be sure to ask if there is a generic available.


Can I get Health Insurance if I have pre existing conditions?Questions and Answers

Shopping for Health Insurance with a pre existing condition can be difficult.

Mostly you will be denied coverage, rated higher and charged extra for premiums and out-of-pocket costs, or at a minimum you have a predetermined waiting period before your coverage will cover your pre-existing condition.

Fortunately, the Patient Protection and Affordable Care Act will help individuals with pre-existing conditions starting in 2014.


What if my child has a Pre Existing condition?

Good news if your child is under 19 years of age. Under the Affordable Care Act any child under 19 on a group or individual plan issued after March 23, 2010 cannot be denied coverage for any Pre Existing condition, including life threatening diseases such as Cancer or Diabetes.


What is a High Deductible plan?

A high-deductible health insurance plan is important to provide affordable coverage for unexpected major health and medical expenses.

Essentially this is a form of catastrophic insurance to protect you against unforeseen accident or illness expenses. These plans charge a high annual deductible – from $5,000 and higher – in exchange for lower monthly premiums.

You’ll have to pay out-of-pocket costs for routine doctor’s office visits or trips to the emergency room until you hit your deductible. The insurance covers everything after that.

To help pay these out of pocket costs, it’s both wise and typical to pair your high-deductible plan with an IRS-qualified HAS (health savings account). You can make tax-free deposits into this account (even if you take the standard deductions and don’t itemize), up to $3,050 annually for individuals or $6,150 for family coverage. If you’re 55 or older, you can contribute an extra $1,000 a year.

These funds are yours to withdraw, tax free, at any time, to pay for medical expenses that aren’t covered by your high-deductible policy.

High-deductible insurance is considered a consumer-driven health plan, giving the patients control over how to spend and invest their money. These types of plans protect you against total losses from unexpected expenses. While your out of pocket expenses may be higher than you may like, it is much wiser than having no plan in place at all. Any plan and protection is better than no plan or protection.

 

Why should I consider a high deductible plan?

The plans offer cost savings over plans because of the high deductible, and they protect you from catastrophic health events.

If you’re in good health, rarely need prescription drugs, don’t have a pre-existing condition and don’t intend to get pregnant, you might consider a high-deductible plan.*

Under those circumstances, you won’t have many out-of-pocket expenses. Meanwhile, you can relax and enjoy the comfort of having protection against any unexpected and expensive medical costs.

The only caveat: You should put aside enough money (typically from $1,000 to $5,000, depending on your policy), to cover your deductibles in case of an emergency.  That’s why pairing your high-deductible plan with an IRS qualified health savings account makes this combination attractive.


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