Health Insurance: Plans for Secured Healthcare

by Guest » Tue Dec 01, 2009 08:17 am

Our health is precious and we do all sorts of things to keep ourselves healthy. We know how it feels to fall sick and if it is something serious, how expensive treatment can get. So that we are able to afford the right treatment and not worry about the costs getting health insurance is a good idea.

The rising cost of treatment is a matter of worry for a lot of us. If we have health insurance, it helps us plan ahead and also save for future treatment costs. We do not have to worry about bearing the expenses out of our pockets. Your need for insurance may be different from the needs of others. Hence, there are different health insurance plans to suit different needs.

Health Insurance Plans

Health insurance plans are primarily of 2 types -
  1. Indemnity Plans (fee-for-service)
    According to this plan, the insurance holder can choose the doctor he wants to be examined by. The doctor/medical professional receives a fee-for-service. This claim is made either by the doctor or the patient himself. Indemnity health insurance has several other types.
    • Indemnity health plans: As a policy holder you may go to any doctor, hospital or any other medical provider for a fixed monthly premium. You may choose the health care provider you want and the plan will reimburse you or your doctor for the service rendered. There may be a certain portion of deductible that you need to pay or simply bear a portion of the fee. Certain expensive services or hospital care or any covered services may require you to have prior authorization for them in order to be covered. To know if indemnity plans are better than HMOs or PPOs click here.

    • Flexible spending plans: This is also known as cafeteria plan and is sponsored by the employer allowing the employees to design their own package. There are several benefits for this plan like pre-tax conversion plan, multiple option pre-tax conversion plan, flexible spending accounts, medical plan and employer credit cafeteria plans.

    • Basic health plan: This is a low cost health insurance plan that provides limited benefits. These plans do not cover certain basic treatments and it is advisable that you should go through the policy document before purchasing. Premiums for such affordable health insurance plans are community rated and are based on gender, age, occupation, geographic location or health status.

    • Health Savings Accounts (HSA): This plan is designed to help you pay for your present health treatment costs and also save for future costs on a tax-free basis. You do not have to pay a premium here. Instead this tax-free account covers your out-of-pocket medical expenditure. What types of investment you should make, which third party or insurer you should rely on is completely your own decision. Generally, HSA requires you to buy a High Deductible Health Plan too.

    • High deductible health plan (HDHP): This inexpensive health plan is active only after a high deductible of a minimum $1000 is paid for an individual or $2000 is paid for a family.

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  3. Managed Care Plan
    Managed care helps minimize unnecessary costs for healthcare. The policy holders receive extensive medical coverage while also giving financial incentives to the policy holders who opt for the medical providers listed in the policy. There are several types of managed care:
    • Health Maintenance Organization (HMO): There is an already existing network of participating physicians, hospitals as well as other health care professionals and facilities that you can choose from. The doctor you choose from the given list will then provide you with the required health treatment. If you need to go to a specialist your primary care doctor will refer. Generally there is a fee or a co-payment that you need to pay in HMP plan. Your out-of-pocket are fewer here.

    • Point-of-service (POS): In this plan the primary care doctors usually have the freedom to refer other medical providers listed in the plan. If the referral is not from amongst the listed doctors, it will still be covered but then you need to pay a certain co-insurance. If the doctor is listed in the plan, then the plan provides coverage for the same.

    • Preferred Provider Organization (PPO) : In this plan the listed doctors, hospitals and health care providers are paid by the insuring company. Often these payments are discounted and hence the costs will be lower if you choose a doctor from the network of doctors provided by the insurer. However, you may still go for a doctor outside the network but you will have to pay the difference between the medical provider's fees and what the plan pays.

    Other health insurance options

    Two of your other health insurance options may include:
    1. Self-insured health plans
      A self-insured health plan or self-funded plan is one where the employer assumes responsibility (with pre-conditions) to provide health care benefits for its employees. This plan is designed such that the employers pay for the out-of-pocket claim as and when they occur instead of depositing a fixed premium to an insurance providing company. Such a self insured plan is subject to all Federal laws and Budget Reconciliation Act.

    2. Medicare
      Medicare is a federal government program designed to insure senior citizens. You can avail the benefits provided by Medicare to secure your future.

    How insurance companies determine your coverage & rates?

    When you apply for a health insurance, your application has to undergo the insurance underwriting process. The underwriters evaluate how much of a risk you pose for the insurance company and accordingly approve or reject your application. Your rates and coverage limits are also determined if the application is approved.

    The following factors influence the health insurance rates of an individual:

    1. Age and gender of the person to be insured.
    2. Pre-existing conditions after a thorough check-up of the individual's medical history.
    3. Medical history of the family (whether or not the parents had heart disease, cancer etc.)
    4. Smoking habits of the individual.
    5. Previous records of mental health (whether the person had undergone counseling or used anti-depressants).
    6. Occupation.
    7. Choice of deductible, coverage and benefit limits, exclusions etc.
    8. Past records of health insurance applications.
    To know how the above mentioned factors have an effect on your health insurance costs, click here.

    Tips to buy affordable health insurance

    The premiums for medical insurance seem to be increasing every year. This leaves us with the question that how we can find affordable health insurance coverage that suits our pocket. It may seem very difficult but with a little research you can still look for a suitable health insurance plan. You may follow the 6 easy tips to choose a health policy which not only suits your needs, but also matches your pocket.
    1. Know your state rules: Be familiar with the rules that your state follows. This way you can make rational and mature decisions about your health insurance. Pay special attention to rules about pre-existing conditions (if any) and also about what coverage you will get.
    2. Find out your insurance needs: Knowing what type of health insurance coverage you need is important. You may need short term health insurance policy or a regular one depending on the status of your job and your family planning. Getting a cheap health insurance policy may not be the solution to all your problems. You will have to keep in mind the requirement that you have.
    3. Calculate the overall costs: Prepare a budget for yourself. Buying health insurance doesn't just mean paying premiums. There are co-payments, deductibles and also sometimes co-insurance. Keep all of these in mind when planning for your insurance.
    4. Compare your options: To be able to find an affordable health insurance you must have an idea of all what is available in the market. After you have shopped enough get hold of a broker who can help you in comparing the policies. A comparison between few different companies and their products will help you settle better with a policy.
    5. Do your insurance homework: You need to be acquainted with the jargons of the industry if you must find yourself a policy that suits you best. Do your homework; get your research done properly to be able to buy a suitable policy.
    6. Never conceal information: While doing the paper works you may have to answer a lot of questions. Don't be tempted to lie or hide facts. This will only create problems in the future for you, and raise your costs for health insurance.

    Individual Health Insurance vs. Employer Sponsored Insurance

    Most of you may have employer sponsored health insurance. But the number of people opting for individual health insurance is also increasing. This increase is due to the advantage that individual policies have over employer sponsored programs. They are:
    • Tailor-made coverage: Everyone has different health needs and individual health insurance recognizes it and provides policies to suit individual needs. Since the employer sponsored program is 'one-size-fits-all type, you may end up paying for coverage you don't need or not get a particular coverage that you may need.

    • Mobility of coverage: Unlike the employer sponsored insurance, you can still carry individual health insurance with you even if you are changing jobs.
    For more information click here.

    You must plan ahead to secure your future. With health insurance you can certainly prepare to face an undesirable situation arising from a medical condition.

    Related Readings:

    Useful letter

    Like temporary life insurance do we have any temporary health insurance options too?

    Total Comments: 105

    Posted: Mon Sep 27, 2010 04:39 pm Post Subject:

    Global Health Asia appears to be legitimate, and claims financial backing from Chartis and Liberty International (a subsidiary of Libery Mutual).

    You'll have to inquire about their plans and costs and coverages, to be able to determine if your needs will be met. But it does not appear to be a scam of any type.

    Posted: Fri Nov 12, 2010 04:51 pm Post Subject: two HDHPs and COB

    I need more information on how having two HDHPs that coordinate benefits works. My family would be covered under both plan A and plan B. Here is a scenario:

    Plan A – has a $5k deductible.
    Plan B – has a $3k deductible.

    (This is how I think it would work, please correct me if I am wrong):
    My husband has services and Plan A denies for deductible.
    The balance is billed to Plan B.
    Plan B also denies for deductible.
    The balance is billed to us.

    1. Once we meet the $3k deductible for plan B, will plan B start to make paymentst?
    2. Or do we have to meet plan A’s deductible BEFORE plan B can even be billed? In which case we have to meet BOTH plan deductibles ($8k) before EITHER insurance kicks in?

    Posted: Fri Nov 12, 2010 11:09 pm Post Subject:

    What exactly is the purpose of having two HDHPs? Most of them cover expenses 100% after the deductible has been satisfied. If one HDHP provides better coverage than the other, drop the one that offers less coverage.

    Having two HDHPs would generally require satisfying two deductibles. That's why you don't need two.

    Posted: Mon Nov 15, 2010 05:26 pm Post Subject:

    My employer requires that if my husbands job even offers insurance, he cannot be primary on my insurance. His insurance is through a carrier that is out of network for our family's current physicians so our out-of-pocket would be doubled. Also, I was advised that HDPD's do NOT coordinate with a PPO insurance. So I was thinking our only option to having less OOP would be to have 2 HDHP's, since:
    1) a HDHP will not coordinate with a PPO plan
    2) MY employer will require my husband take HIS employer's insurance as primary (therefore doubling our OOP expenses)

    Are you confirming that I would have to satisfy $8k in deductibles as I outlined in my scenario?

    Do you know about whether or not the information I received regarding the COB between a HDHP and a PPO plan is accurate?

    Posted: Tue Nov 16, 2010 09:48 am Post Subject:

    His insurance is through a carrier that is out of network for our family's current physicians

    You have it backwards. The physician is not in the insurer's network. Have you asked the physician why he doesn't join the other network?

    To avoid the higher out of pocket expense, your husband needs to find a physician in his employer's plan's network. Learn to use the insurance appropriately.

    HDHPs do not coordinate with anything. You pay the deductible amount and they cover the balance for the year. What is so hard about that? Generally, you have to use network physicians to avoid a higher deductible. What's so hard about that?

    You don't seem to be very cooperative when it comes to using your health insurance.

    Posted: Tue Nov 16, 2010 02:43 pm Post Subject:

    My questions were in regards to whether or not the HDHP coordinated with anything and if so, how it worked. We are not being uncooperative, we have just established relationships with our physicians and do not want to change them if we don't have to. Thank you for taking the time to answer my questions. I'm sorry you found the need to be a jerk about it though.

    Posted: Wed Nov 17, 2010 03:55 am Post Subject:

    Sorry if you took my comments in the wrong manner. I understand that you may have established relationships with physicians that you would prefer to maintain, but may not be able to do so. People all across America who have employer-sponsored health insurance face this dilemma all the time when the plan changes from one year to the next. It does not make husbands and, especially, wives happy to have to look for a new physician every year.

    You started out by stating that your insurance won't allow your husband to use your employer-sponsored plan as his primary insurance, which is accurate if he's covered by an employer-sponsored plan of his own. It seemed as if you thought you had the right to choose which plan is primary for him. But you don't.

    On the other hand, a person cannot be forced to join their employer's health plan, unless it is a "non-contributory" plan (the employer pays the employee's full cost of the plan). I doubt that your state's insurance law requires a person to enroll in their employer's-sponsored plan if there is a fee, and if their spouse's employer-sponsored plan is less costly or offer better benefits, they have the freedom to only be covered by their spouse's plan. Obamacare, however, may change that in the future.

    As explained, an HDHP is intended to be the only health plan that covers a person as an individual, or a person and their dependents. There is no point to having more than one HDHP covering the same persons. Doesn't mean you can't have an HDHP for yourself, and your husband has an HDHP for himself, and neither plan covers the other. The limitations on contributions to the required HSA do not change when there are two separate individual HDHPs involved, and you could end up not being able to contribute the entire individual amounts to two HSAs.

    Posted: Thu Dec 09, 2010 03:33 pm Post Subject:

    hi Sil Anderson.

    actually i have a second thought on getting an insurance for my dad. seems like it's not working any more because our system on health care has been change. i need some advice.....if i will continue or not...

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