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What are my options for individual health insurance coverage? You may purchase coverage from a commercial insurance company under an individual or family plan. Depending on your income, you may qualify for government programs such as MediCal. There is also a special program for children called Healthy Families. If you are over age 65 and covered by Medicare, you may want to purchase a Medicare Supplement. What options is available under commercial insurance plans for individuals and families? There are three basic types of health plans: Indemnity,
PPO and HMO plans. Comprehensive plans usually reimburse the insured at a percentage of billed charges after a deductible has been met. The deductible is the amount the insured must pay first, before any expenses are reimbursed. Only "covered" expenses accrue toward the deductible. It's important to under stand the plan's exclusions when you purchase coverage. PPO Plans provide an incentive to the insured to use a certain group of medical providers. The plan will pay the highest level of benefits when using the "preferred " providers. This usually benefits the individuals because they also benefit from the discounts that have been pre-negotiated with the providers. For example: the billed charge for an x-ray is $60. The PPO plan's "negotiated rate" is $45. If the insured's has not met their deductible, the insured pays the $45. If the deductible has been met, then the insured pays their percentage of the $45. If the plan pays 80%, the insured would pay 20% of $45 or $9 instead of 20% of $60 or $12. The greatest saving is on high dollar cost services. In many cases the PPO discounts are very large and save the insured thousands of dollars. (Blue Cross and Blue Shield) HMO Plans: These plans are the most restrictive. Typically, the individual must use the plan's providers or receive NO benefits. Further, the health plan will often require that care be directed through the Primary Care Physician (PCP) of the individual. If an individual is comfortable with the health plan's rules, this will often result in the least out of pocket cost and the richest benefits for the insured. Do I have to take a physical to apply for health insurance? Usually, no. Most plans use a "non-medical" application that requires you to provide detailed medical history. The underwriting process may require the company to write to your doctors for more detailed medical information to determine if you qualify. This can extend the process for 4-6 weeks. The company then decides to issue or deny coverage, depending on health history. The applicant may be charged an additional premium, but may not be issued coverage with waivers or exclusions for a specific condition. If you do not have current coverage, we recommend that you consider temporary insurance for coverage during the underwriting period. If you can answer “no” to a few questions, you will be covered immediately. This coverage is also appropriate for persons between jobs or students who have recently graduated. What kind of coverage should I buy? We recommend that you buy the highest deductible you can afford. Make sure the plan provides at least a $1 million lifetime maximum benefit. Also, look at the " out of pocket maximum". This is your "worst case" share of the expenses in the event of a catastrophic illness. What is an HSA?
A Health Savings account is available to all persons covered by a Qualified High Deductible Health Plan (HDHP). This allows them to set aside money on a tax favored basis to pay qualified medical expenses, while still maintaining a high deductible health plan to protect against catastrophic loss. The best part is if you don't use the money, it continues to accumulate and can supplement your other retirement plans. This way the money is in your pocket, not the insurance company's. Check out www.msabank.com for more information and see us for your health plan! What happens if my application is denied? If you are denied coverage, you may apply for the California Major Risk Plans. (MRMIP). There is a waiting list of as long as 18 months to get into this plan, as enrollment numbers are limited. Or you could qualify for "guaranteed issue" coverage under HIPAA (Health Insurance Portability and Accountability Act). To qualify, you must have been previously covered by a group health plan and exhausted all COBRA benefits. In addition, you must not have had a lapse of coverage greater than 63 days. What is Healthy Families? This is a health plan subsidized by tax money, designed to provide coverage for uninsured children of low income families that earn too much to qualify for MediCal, but not enough to afford commercial coverage. The plan provides medical, dental and vision benefits at a cost of $7-12 per month per child. An application assistant can help complete the paperwork. Our office has a certified application assistant who can help you. What is MediCal? MediCal is the federally subsidized health plan for low- income people. In some states it is called MedicAid. Applications can be obtained by appointment through the County Social Services Department. What is a Medicare Supplement? These are plans designed to pay the share of expenses that Medicare does not pay. The standard plans are label A through to J. All standardized plans provide the same benefits, which makes it easier for consumers to compare. Plan A provides the lowest benefits and Plan J provides the highest. These plans are "guaranteed issue" to those turning age 65 and becoming eligible for Medicare benefits. It is important to evaluate coverage. For example, the Rx benefit under
plan J is a maximum of $3000 after a separate $250 Rx deductible. If the
additional premium is $150 monthly, you are only buying $1200 of Rx insurance.
Be sure to evaluate your true Rx use before deciding.
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