blog

Maternity Coverage - Should You Buy It?

Wed, 07 Mar 2012 19:41:24 +0100

If you're applying for health insurance and are planning to expand your family in the foreseeable future, there's always the big question of whether to add maternity coverage. You might think the answer is a pretty straightforward "well, of course," but it's really not. Here are a few things you should know:

Maternity coverage is expensive. There's no other way to put it. The rate depends on the age of the woman and her choice of base plan, but it can easily double the premium.
Most individual insurance carriers in NC and SC don't even offer maternity coverage any more.
The times at which you can add maternity benefits are limited. For the carrier I most often recommend, maternity coverage must be added at the time of initial enrollment, or during an enrollment period at the end of each year for a January 1st effective date.
A client can not add the coverage while pregnant, so the length of time a covered individual will be paying for maternity coverage is an unknown.
The deductible and coinsurance on the base plan still apply. So, for instance, a woman with a $2,500 deductible and a 70/30 coinsurance with a $3,000 maximum out-of-pocket might still incur costs of as much as $5,500, even with maternity coverage.
Under federal law, "complications of pregnancy" must be covered by ALL insurance policies, with or without maternity coverage. (What constitutes a "complication," however, can be somewhat nebulous.)

I was recently told by a client (who is currently pregnant and does have maternity coverage), that she was informed by her health care provider that individuals without maternity coverage are eligible for as much as a 40% discount on the delivery costs.

As I said, how to buy with a pregnancy in mind is not simple. In many situations, the maternity coverage probably ends up being a form of pre-payment option, where the additional premiums pretty close to match the amount actually paid out by the insurance coverage. And of course there's no option of a refund if a pregnancy never occurs.

More people, in fact, are opting for an HSA plan without maternity coverage, keeping their monthly premiums lower. They then have extra dollars available to put into a Health Savings Account to pay for the maternity costs, with the added benefits of having saved on their income taxes.

I wish there were an easier way to know whether maternity coverage will turn out to be a good buy. But, as I've always said about buying any insurance, "You tell me what's going to happen in the future and I can tell you the perfect plan for you!"

Handling A Denial of Claim - One Agent's Story

Wed, 01 Feb 2012 21:34:14 +0100

I'll be the first to tell you, I do NOT like hassles. And I don't particularly like confrontations either. So when the Explanation of Benefits form (you know, that "This is not a bill" thing from your insurance company) for my husband's recent annual checkup arrived showing several segments of the claim denied, I cringed. Before long, the bill from the doctor's office arrived, showing a balance due. Yuck.

In all honestly, I was sorely tempted just to pay it and be done with it! But then I realized that this would be a good learning experience that I could share with my clients and my newsletter readers. After all, I've always preached not to take a denial of claim as the final word.

The final resolution isn't in yet, but this is how I've set the query in motion for clarification so I can either accept it or continue appealing the decision:

1) Using the Explanation of Benefits (EOB), I called the insurance company and had them explain exactly what the various diagnostic codes meant. By the way, these diagnostic codes are assigned by the doctor at the time of the visit. They're on that sheet you carry up to the front desk at the end of the visit. On the EOB, they were just broadly labeled "laboratory" and one was labeled "diagnostic," which didn't give me much to go on.

2) The insurer's member (or customer) service agent was able to expand on what the codes actually meant and even gave me a little extra information like "yeah, that code is so general it's almost always denied" or "that's coded as a diagnostic service - an EKG, specifically - for hypertension rather than preventive."

3) The CSR also shared with me that some of the items that are normally automatically declined would probably be "forgiven" by the insurance company (YES!), but we needed to get clarification - and possible re-coding - on the "diagnostic" portion first. (Not sure why that is, but okay, I can live with it for now. I wasn't looking a gift horse in the mouth - so to speak - at that point.)

4) Armed with this information, I called the doctor's office armed with information. As of right now, the "diagnostic" EKG is being run by the doctor to see if he will reconsider the way he coded it.

What have I learned from this so far? Well, I will be sharing with the doctor's office (probably via letter to the office manager and the billing department) that there are certain codes that probably just shouldn't be used. Like "#80050 - General Health Panel" which apparently means nothing to my insurance company.

And I'll tell the doctor, too. Our doctor is wonderfully cooperative, always open to a discussion of whether a specific test is needed, or whether a generic will work just fine, and so forth. But if I don't let him and the rest of the practice know when and why a claim is being denied, how can they fix it - both for Bill and me, but for other patients?

No matter which way this all lands, I've found it both instructive and empowering not to just stick my head in the sand and pay the bill. I've learned a little more about how the "system" operates and have picked up knowledge that has been useful to me and that I hope will prove enlightening to my clients. That's time well spent!

When a Plan with Fewer "Bells & Whistles" Can Actually Lower Your Out-of-pocket ...

Wed, 18 Jan 2012 20:23:40 +0100

A few weeks back we hosted our annual New Year's Day brunch for a few neighbors. The recent experience of one of my neighbors pointed out that even when an employer is picking up most of the tab for your health insurance premium, a pricier plan doesn't always turn out to be the best choice. Here's Joanne's (not her real name) story:

Joanne had opted for what she thought would be the best coverage her employer offered: one with a deductible (for the "big" things) and copays for certain services such as Urgent Care, ER, office visits and prescriptions. After a recent spill off a horse, she ended up at an Urgent Care Center and then in the hospital for several days (including two ambulance trips) for what turned out to be several broken ribs and a liver laceration.

When she chose her plan, she hadn't counted on running into a situation with seemingly endless copays (for example, $50 per office visit) to a number of specialists. The problem with copays is that they don't count toward the deductible so they don't ever end. There is (in insurance-speak) no stop-loss point.

Joanne says she now wishes she had opted for the much simpler HSA-qualified plan which just has a deductible (preventive care is covered at 100%) so she'd at least know that once she's met her, say, $2700 deductible, everything else is 100% covered. And she also would have been eligible to put income-tax-free dollars into a Health Savings Account.

Would I have recommended that Joanne opt for a different plan? Maybe, maybe not. She probably made a smart choice based on her health status at the time. But this story does highlight why choosing a health insurance plan is ALWAYS a "maybe, maybe not" choice. As I've said to many clients over the years, "You tell me what's going to happen to you and your family in the future, and I'll tell you the exact plan you should buy!"

Of course, unlike Joanne, my clients are normally picking up the full cost of the monthly premium, which certainly factors strongly into the decision-making process. My general suggestion (in the absence of other factors, such as expensive prescriptions) is to keep the known expenses (premiums) as low as possible, within reason. Statistically, most people are going to have relatively few run-ins with the "medical industrial complex" in most years.

Sometimes, you just have to play the odds, knowing that occasionally you DO, unfortunately, come out on the short end of the stick. My goal for clients is to have that happen as seldom as possible!

Medicare Part D Prescription Drug Coverage

Thu, 22 Sep 2011 12:15:09 +0100

If you or a loved one are eligible for Medicare soon, you're probably feeling overwhelmed at this point with all the "stuff" that's come in the mail. You may have figured out that you'll need a Medicare supplement (also called Medigap) policy to cover the things that original Medicare doesn't cover.

But you may be feeling a little confused about the prescription drug part. The short answer is this: You'll also need to purchase a separate plan for prescription drug coverage (a PDP, for short), also called Medicare Part D.

I know this sounds a little clunky, as in, "Why the heck isn't it just part of the Medicare supplement?" and I really can't tell you why the government opted to do it this way, but they did. The good news is that Medicare didn't offer ANY prescription drug coverage until 2004, so having the coverage at all is a great help to many people.

Since there are a multitude of plans offered by a host of different insurance company, the best way to figure out which plan will work best for you is to use the Plan Finder Tool on the Medicare.gov website. I recommend using the Personalized Search, since this lets you enter your medications. It will take into account the PDP's monthly premium, the tier(s) of your drugs, copays, deductibles, and other parameters that will affect your overall costs.

Because the plans that are offered change constantly, not to mention that people's medication needs are always subject to change, each year a Medicare recipient has an opportunity to change PDPs. The enrollment period for that is from October 15 - December 7th. The effective date for all PDP changes is 1/1/12.

So I recommend using Medicare's Plan Finder Tool when you're first eligible for Medicare Parts A & B, and then again during the PDP special enrollment period toward the end of each year, especially if your plan or your drugs have changed during the year. If you're happy with the plan you have and it's working, you can do nothing and stay on the same plan.

SilverSneakers Program for Seniors

Mon, 12 Sep 2011 18:30:40 +0100

Small Business Owners - Group Health Insurance for Your Employees?

Thu, 14 Jul 2011 15:51:23 +0100

I frequently hear from small businesses owners who are pondering offering group health insurance. Since I only work with clients who buy their own insurance, I usually refer them on to Jacqueline Habenicht of Benefit Empowerment, who focuses on that area of expertise. She does a really good job of laying out what putting in place a group plan entails.

While there are some really good reasons for an employer to have a group health plan (for attracting and retaining employees, for example), from where I sit, there are also some reasons to tread cautiously:

Annual rate increases are figured differently for group plans than for individual health insurance. Each year, new premiums are refigured based on the group's prior year's claims. This is not allowed on individual plan - i.e. your own rate can not go up based on your or your family's claims.

Group plans are subject to legal requirements and HIPAA regulations that may prove burdensome to business owners.
Once your employees have it, it's very hard (from a morale and management perspective) to take it away.
For reasonably healthy group members, individual health insurance is usually much less expensive, especially if you avoid "Cadillac" plans.
At least in the Carolinas, there are now many more options for individual coverage even for people with serious pre-existing conditions, so insurability is much less of a reason to go the group insurance route.

One suggestion that I'm now making to small business owners is having all employees go with individual High Deductible Health Plans that meet the federal requirements for use with Health Savings Accounts - so-called "HSA plans".

This lets the employee own their own health insurance, helps keep their premium low, and the employer can deposit tax-free (to the employee) funds into the employees' health savings accounts (in 2011, up to $3050 for individuals or up to $6,150 for families) for use for future medically-related expenses.

The employee never has to pay income taxes on that money and it's amazing how quickly that money adds up over time. It's like "free" money to the employees and the employer is better able to control health care-related costs.

How Having Health Insurance Can Help You Get a Job - or a Better Salary

Thu, 30 Jun 2011 22:12:30 +0100

Did you know that having your own health insurance can give you more flexibility when job-hunting?

1) It allows you to accept a part-time or contract position that doesn't provide health insurance benefits (but that might lead to a full-time job offer at some point).
2) It may make you more appealing to an employer who is concerned about the high cost of providing a full benefits package.
3) Having your own health insurance means you won't have to accept a position that you know really isn't a good fit but that you feel you have to take to get the insurance coverage.
4) You may be able to use the fact that you won't need a potential employer's health insurance as a bargaining chip in salary negotiations.

Additionally, when you own your benefits, you won't feel you have to stay in a job that you hate.

A "Grandfathered" Health Plan - What it is and why you should know about it

Wed, 20 Oct 2010 16:48:15 +0100

A new term in health insurance with which you should probably familiarize yourself is "grandfathering." Understanding what it means and how it could affect you is important, particularly as it relates to individual health insurance. In fact, because I specialize in individual (as opposed to group, i.e. employer-based) health insurance, I'm not even going to address its implications for group coverage.

Do you remember when Pres. Obama kept emphasizing that if you liked your current health insurance and wanted to keep that coverage, that would be fine and you could do that under health care reform? Well, that's where the concept of grandfathering of health plans began.

A plan that was in place as of the day Obama signed the Health Care Reform (HCR) bill, March 23, 2010, is a "grandfathered" plan. If you had a health plan in place on that day, as long as you keep that plan, with absolutely NO changes, that plan will not be subject to all the requirements of HCR.

All the mandated benefits under HCR will not be cheap. Non-grandfathered plans will very likely become more expensive more quickly than grandfathered plans. Yes, HCR plans may have access to some things (like "free" preventive care services that are not free under grandfathered plans), but there is no such thing as free, as we all know.

The important thing to take away from all of this is to think carefully about all the possible ramifications of changing your plan if you had it in place on March 23rd. Does this mean no one should change plans? Absolutely not. But it IS important to consider the benefits of making a change against the potential future costs. The unfortunate part is that we can't predict just what those costs will be.

Continuous Coverage - What is it and Why is it important?

Tue, 28 Sep 2010 22:47:08 +0100

Continuous coverage is creditable health insurance coverage without a lapse of more than 62 days during the last 18 months. Technically speaking, the "creditable" part applies to group insurance plans, but most individual carriers will recognize most major medical plans as being creditable.

For most individuals, this issues comes up when they either are about to or already have ended COBRA, but the issue can also arise if they have let their individual coverage lapse for a period of time.

The problem with having a 63-or-more day lapse is that your new insurance carrier can then deny coverage for pre-existing conditions for the next 12 months. This is pretty much a non-issue if there are no pre-existing conditions or if the pre-ex is something relatively minor. But if the pre-ex is cancer or heart disease or some other condition which could be both serious and expensive, having no coverage for that condition is a HUGE issue.

If I have a client who is right up against that 62-day window, we'll use a short-term plan to bridge the gap until more a permanent major medical plan can be put into place. This is a temporary strategy, of course, but it can be perfect for preventing a client from having to wait a whole year until their pre-existing conditions are covered.

We agents work for our clients, not for the insurance companies

Wed, 22 Sep 2010 18:06:43 +0100

I had a situation come up recently that reinforced how important communication is - in ALL of life of course - but particularly during the health insurance buying process. I can't stress the importance of letting your agent in on any and all health-related issues that the potential insureds either have now or have had in the past that might impact the underwriting outcome.

I'm well aware that it can be uncomfortable to reveal personal health information to a virtual stranger, but we agents are working for you, the client. Our work on your behalf and the recommendations that we make in any given situation are highly dependent on having all the relevant information.

In the most recent example of how this went awry, the client failed to tell me that she had recently had an abnormal lab test result. The application asked whether there had been any abnormal test results, and my client rightfully answered that she had. Now if there's one thing a health insurance company hates, it's uncertainty.

In my client's defense, I'm sure she figured the situation "was what it was" and it just didn't occur to her to stop and call me. And I had not specifically asked her to do so, so I can thoroughly understand why she hit the Submit button.

However, had she exited the online application and called me for advice at that point, my recommendation would have been for her to abort the application process right there, without submitting it. I would suggest she have a re-test until the results were negative or to have the issue taken care of under her current insurance until all related issues were resolved.

Unfortunately, she received a significant rateup (presumably) because of the abnormal test results. At this point, it's impossible to put the metaphorical toothpaste back in the tube. However, we do hope to be able to get her test situation cleared up and for her to be able to re-apply with the same carrier in the near future, so hopefully all is not lost.

The bottom line is this. We health insurance agents deal with this sort of thing every day and we can give some pretty darned sound advice that can save our clients big bucks. We are agents working on behalf of our clients, not on behalf of the insurance companies. But we can't fix something if we don't know about it. And I just absolutely hate it when that happens.