Why should I have health insurance?
The cost of health care has risen drastically over the past few decades. If you do not have medical insurance to help pay bills, a serious injury or illness can be financially devastating to you and your family. If you don’t have coverage you can be exposed to high health care bills; or, if you have too little or the wrong kind of coverage, you won’t have enough protection. Under the Affordable Care Act (ACA) aka, Obamacare, a new law requires all individuals have health insurance either through their employer or through an individual policy. The penalty for not having health insurance is either 1% of your income or $95, whichever is greater!
What Types of Health Insurance Are Available?
Major Medical Plans
This type of policy is usually effective in covering serious illness or injury where costs are high. Hospital care, drugs and doctors’ visits, are usually covered. These benefits can be delivered in several different ways:
- Preferred Provider Organization (PPO) plans – In these major medical plans the insurance company enters into contracts with selected hospitals and doctors to furnish services at a discounted rate. As a member of a PPO, you may be able to seek care from a doctor or hospital that is not a preferred provider, but you will probably have to pay a higher deductible or co-payment. Before selecting the insurance company, you should check to see if your doctor and hospital are in the network of choice.
- Health Maintenance Organization (HMO) plans – These major medical plans usually make you choose a primary care physician (PCP) from a list of network providers. Your PCP is responsible for managing all of your health care. If you need care from any network provider other than your PCP, you may have to get a referral from your PCP to see that provider. You must receive care from a network provider in order to have your claim paid through the HMO. Treatment received outside the network is usually not covered, or covered at a significantly reduced level unless approved in writing by the HMO.
- Point of Service (POS) plans – These major medical plans are a hybrid of the PPO and HMO models. They are more flexible than HMOs, but do require you to select a primary care physician (PCP). Like a PPO, you can go to an out-of-network provider and pay more of the cost. However, if the PCP refers you to an out-of-network doctor the health plan will pay the cost.
- Short Term Insurance - This type of coverage is a health insurance policy that is only available for 1-6 month periods. They still require some medical questions to be answered. They NEVER cover anything that you have received prior medical care for before your effective date of the short term policy.
Limited Benefit Plans
These types of policies provide limited coverage for a particular health care setting, ailment or disease. Here are some of the options that may be available to you:
- Basic Hospital Expense Coverage – Covers a period of usually not less than 31 days of continuous in-hospital care and certain hospital outpatient services.
- Basic Medical-Surgical Expense Coverage – Covers costs associated with a necessary surgery, including a certain number of days (usually not less than 21 days) of in-hospital care.
- Hospital Confinement Indemnity Coverage – Covers a fixed amount (usually not less than $40) for each day that you are in a hospital. The benefits paid are not based on your actual expenses.
- Accident Only Coverage – Covers death, dismemberment, disability or hospital and medical care caused by an accident. Specified accident coverage that covers only certain accidents may also be purchased.
- Specified Disease Coverage - Covers diagnosis and treatment of a specifically named disease or diseases, such as cancer.
- Other Limited Coverage – You may purchase insurance covering only dental or vision or other specified care.
Additional Coverage Options
These types of policies provide added protection should you become disabled, require long-term care, or enroll in Medicare:
- Disability Income - This coverage provides for weekly or monthly benefit payments while you are disabled after a covered injury or sickness. The disability payment is usually a set dollar amount not to exceed a certain percentage of your income. These policies usually expire when you become eligible for Medicare. Short Term Disability is usually for 6 months or less. Long Term Disability can be from 6 months to 3 years or more.
- Long-Term Care Insurance - This policy usually pays for skilled, intermediate and custodial care in a nursing home, and also for care in other settings, such as the home, adult day care center or assisted living facility. The policy usually pays a fixed amount per day while a person is receiving care. Medicare does not pay for Long Term Care.
- Medicare Supplemental Coverage - The federal Medicare program pays most medical expenses for people 65 or older, or for individuals under 65 receiving Social Security disability benefits. However, Medicare does not pay all expenses. As a result, you may want to buy a Medicare Supplement policy that helps pay for certain expenses, including deductibles not covered by Medicare.
- Cancer insurance is not a substitute for comprehensive coverage - Cancer treatment only accounts for a small percentage of the American public’s health care bill. That is why it is essential to have insurance coverage for all conditions, not just cancer.
- Consider a major medical policy if your family is not protected - If you and your family are not protected against catastrophic medical costs, consider a major medical policy. These policies pay a large percentage of your covered costs after a deductible is paid.
- You may not need extra coverage - Ask yourself these three questions: Is my current coverage adequate for these costs? How much will the treatment cost if I do get cancer? How likely am I to contract the disease?
- Duplicate coverage is expensive and unnecessary - Buy basic coverage first, and then make sure a cancer policy will meet any needs not covered by your primary plan. Don’t assume that double coverage will result in double benefits.
- Check the policy’s limitations - Some policies pay only for hospital care. Many treatments, including radiation, chemotherapy and some surgery are often given on an outpatient basis. Cancer patients often face large, non-medical expenses that are not usually covered by cancer insurance. Examples are home care, transportation and rehabilitation costs.
- No policy will cover cancer diagnosed prior to policy application - Some policies will deny coverage if you are later found to have had cancer at the time of purchase, even if you did not know it.
- Most cancer insurance does not cover cancer-related illnesses - Cancer or its treatment may lead to other physical problems, such as infection, diabetes or pneumonia.
- Many policies contain time limits - Some policies require waiting periods of 30 days or even several months before you are covered. Others stop paying benefits after a fixed period of two or three years.
These are NOT health insurance plans:
- Discount Plans - You may receive advertisements from plans offering discounts on health care for a monthly fee. These are not health insurance plans and participants do not have the same protections as under licensed health insurance plans. Insurance commissioners strongly recommend that you thoroughly investigate any plan promising deep discounts for a “low” monthly fee and weigh the benefits against the cost carefully.
- Non-Licensed Risk-Sharing Plans - You may receive offers to join a group or association that will take your monthly payments, put them in a savings account (or trust) with other participants’ money, and then help pay some of your health care costs, as needed. Such arrangements are not insurance and the participants do not have the protections available to purchasers of licensed insurance plans. Insurance commissioners strongly recommend that you thoroughly investigate such plans before joining.
Can my employer change our health insurance carrier and level of benefits during the year?
Yes. It is completely up to the employer whether or not they will offer health insurance to employees at all, and they can change carriers and level of benefits at any time. Changes made must include the mandated levels of coverage in the ACA (Obamacare) Law.
What happens when my group health coverage ends?
You can apply for individual health coverage under the ACA (Obamacare) plan online at the Federal Website or go to www.Hustoninsurance.com and click on the "Get A Quote" button. You may also be eligible for subsidies from the Federal Government.
What happens to my group health coverage if I leave my employer?
You may be eligible for protection under the Consolidated Omnibus Budget Reconciliation Act (COBRA) law and entitled to a minimum of 18 months of continuation coverage. You can find out more about COBRA continuation of group health benefits from the Federal Department of Labor Office of Employee Benefits Security Administration website.
Can health insurance companies deny my application for individual insurance due to a health condition?
No, the new ACA (Obamacare) law does not allow denial of coverage, but you must apply for coverage during open enrollment unless you have a qualifying event. However, once you are accepted for coverage, the company cannot cancel your policy except for nonpayment of premium.
What is a preexisting condition?
This is normally a physical or mental condition for which medical advice, diagnosis, care or treatment is recommended or received before the effective date of the policy. Preexisting does not apply on permanent policies, but it does apply if you buy a short term health insurance policy.
Is there assistance available?
Yes, under the ACA (Obamacare) Law, you may qualify to subsidies from the Federal Government. Each individual circumstance is different, so it is best to contact Huston Insurance and we will assist you. You may contact your state government to learn about your eligibility for Medicaid (for low-income and disabled persons). You may also contact the Department of Health and Human Services for information about Medicare (including the new prescription drug program which provides many subsidies).
What is a “self-insured” plan?
An employer may choose to “self-insure” by paying out benefits from its own funds. Typically, an insurance company administers the program, but the liability for paying for the care of the employees rests on the employer. It is important for workers to understand that if their employer “self-insures,” state patient protections (such as access to internal and external appeals processes, assurance of certain benefits, and the right to have grievances heard by their State Insurance Department) do not apply. All federal protections (i.e., HIPAA and COBRA) do remain. Some of the ACA (Obamacare) mandated coverage's do not apply in a "self-insured" plan.