Once you know how to compare the key benefits of health plans, where do you start. We’ve created 6 typical situations that people call us about. Then we show you what plans are a good fit for those situations. You can use this to shorten your search time.
4 Keys to Understanding Health Insurance Plans
All health insurance plans have some benefits that aren’t important to the majority of people and should be ignored when comparing various plans. Understanding the 4 key parts of all health insurance plans that you should pay attention to will make it easy to recognize a plan that will fit your specific health insurance needs.
We’ll also show you the 2 questions you have to ask yourself BEFORE you choose a health plan.
The 4 key parts are:
- Office Visit Co-pays
- Deductible Amount
- Out-of-Pocket Maximum
- Prescription Benefits
Office visits are the most commonly used benefit in health insurance plans, and are one of the benefits that the insurance companies use to differentiate low cost plans from medium and high cost plans. The Insurance companies are required to offer plans with 0 to unlimited office visits for a simple copay of $20-$60.
If you only go to the doctor for your preventive screenings, a plan that offers only 0 to 3 office visits would be a better choice for you. If you have children that visit the doctor 2-3 times per year for colds or injuries, then a plan that offers 3 office visits would be a good choice for them.
All new health insurance plans are required to provide Preventive Services (office visits and labs tests) for zero cost, and these preventive visits will not count as one of your regular office visits.
Deductibles are the medical costs you are required to pay before the insurance company begins to pay for any non-preventative benefits you use.
As an example, let’s say you have a Silver PPO plan with a $2,000 deductible. If your child breaks an arm and you take them to an urgent care center, and the insurance company’s negotiated rates at the Urgent Care center total up to $1,500, then you would be responsible for the $1,500 as part of your deductible.
If the same child fell off a bike and had a cut requiring stitches later that year that cost $750 at the Urgent Care center, then you would pay $500 as the last part of your deductible, and you and the Insurance company would share the cost for the remaining $250 based on your co-insurance amount. You would pay $50 and the insurance company would pay $200 based on a Silver plan 20% co-insurance rate.
This is the total amount you would pay in any year if something major was to happen.
Once you reach the deductible amount in any year, the insurance companies begin sharing the cost of any additional expenses, with you paying 20-50% and the Insurance company paying the rest. This cost-sharing, or Co-Insurance, continues until you have paid an amount equal to the Out-Of-Pocket Maximum.
For most people, the Out-Of-Pocket Maximum should not be a primary decision factor because the likelihood of having a major medical event happen is fairly small.
The last key area is the prescription drug benefit. The 3 common drug benefit options are Generic Only, Generic and Brand Name , and no prescription benefits. Plans that offer Brand Name prescription coverage will typically have a separate deductible for the Brand Name prescriptions, and at the beginning of the year you will be paying for your Brand Name prescriptions until you reach the prescription deductible, then you will have a copay for additional Brand Name refills. It is usually a good idea to have a plan with both Generic and Brand Name benefits, but these plans will cost more than plans offering only Generic coverage.
2 Pivotal Questions To Ask Before You Shop
The new Affordable Care Act plans are standardized, so each “metal” plan offers the same benefits at each insurance company. A Silver plan from Blue Shield has the exact same benefits as the Silver plan from Health Net. So how do you determine whether a Bronze, Silver, Gold, or Platinum plan is going to be best for your situation?
Ninety percent of all Californians are in either a Bronze (~30%) or a Silver (~60%) plans, so these 2 questions will narrow the plan selection for you.
Qusestion 1: How many office visits do you (and each member of your family) use in a typical year?
Answer 1: If it’s 0 to 3 office visits, then a Bronze plan will work. If it’s more than 3, then a Silver, Gold, or Platinum plan is better.
Question 2: Do you have any prescription medications? And if so, are they Brand or Generic?
Answer 2: If you have no prescriptions, then Bronze could be the right plan. If you take 1 or more medications and they are all Generic, then Bronze or Silver are the plans for you. Determine how much your monthly cost is for the Generic medications. If that amount is LESS THAN the cost difference between Bronze and Silver plans, then a Bronze plan is probably a better choice.
If you have Brand name prescriptions, then you will better off in a Silver, Gold, or Platinum plan.
With a good knowledge of how these 4 keys components work and answers to the 2 pivotal questions, finding and analyzing health insurance plans will be much easier. After all, who wants to spend a lot of time looking for health insurance. If you have any uncertainty, or just want someone to give you a hand, then call us and we’ll be happy to help you.
Health Insurance Plan Recommendation Table
This table will be updated whenever there are changes to pricing or benefit levels. The recommendations are based upon the characteristics of the 6 Consumer Classifications described below. These 6 classifications are further broken into 3 age groups: 30, 45, and 60. The ages were chosen to show the differences in plan recommendations due to age.
Use the recommendations from the table as your starting point to determine which plan is the best fit for your specific needs.
You are between the ages of 20 – 65, and usually don’t go to see the doctor more than once a year. You are healthy and just looking for a safety net such that if something did happen you wouldn’t get wiped out financially.
Planning to have a Baby
You are a couples or a family between the ages of 20-45 that are planning to have a baby within the next year. The mother-to-be will need a plan that offers maternity care while the rest of our family should be in a plan from the “Families with Young Children” classification.
Be sure to see the specific maternity plan recommendations for all 19 regions of California on the Maternity Insurance California page.
Families with Young Children
You are between the ages of 25-50, with children that are young and occasionally bring home the current cold going around school. Your family does the standard preventive visits and 2-3 Doctor’s office visits for illnesses that don’t respond to home treatment, or injuries that occur from activities and sports.
Middle Aged Professionals
You are self employed, own a small business, or work for a business that does not provide health insurance. Your age ranges between 35-60, and you may have teenage children. You have a minor preexisting condition or take a prescription, and need to visit the Doctor 1-2 times a year for maintenance of your health.
You are between the ages of 55-65. You have a few minor preexisting conditions and may take a few generic and/or brand name prescriptions. You are no longer working full time, and don’t have health benefits through work, or can’t afford the COBRA cost of your previous work health benefit plans, or have exhausted your COBRA coverage. You go to see a physician 3-4 times per year.
You are between the ages of 1-65. You have a chronic preexisting condition that requires medications and multiple office visits to monitor your condition. You take a few generic and/or brand name prescriptions. You go to see a physician 4-12 times per year. This chronic condition could be physical or mental.
Click on the table to get a larger version
back to Table of Contents
Application Tips – Position Your Application For Approval
You’ve decided what health insurance plan to apply for, so you click on the “Apply Now” button and you begin to fill out the information. Once you’ve finished the basic contact information and basic information about each person on the application, you reach the section with the long list of health questions. At this point your mind begins to worry that one of the upcoming questions is going to cause your application to be declined unless you answer the question just right. Well don’t fear, this article will give you the right way to answer the questions completely and truthfully, and know that you will probably be accepted by the insurance company.
The health insurance application is the insurance company’s means of getting a snap-shot of your current health and any past ailments that might cause longer term treatments now, or at some point in the future when you are using their medical insurance plan. For this reason, they want to know as much detail as they can, in order to feel comfortable that you are not going to have medical problems that the insurance company will have to pay for. So it’s in your best interest to tell the insurance company what they need to know, rather than trying to hide the information.
First you want to read the paragraph at the beginning of the health insurance question section carefully and make note of the time period the health questions will apply to. The applications typically ask for information that goes back 5-10 years. If so, then make sure that any answers that you check “Yes” are within that 5-10 year period. Don’t dredge up things from your distant past and put them on the application. Also, know that any questions you check “Yes” will require extra information, and this will happen once you get to the end of the health questions or before the online application lets you move to the next page. So gather your medical information before you start.
When you begin providing more information about the health questions that you answered with a “Yes,” you must tell the truth, but that doesn’t mean you have to make the truth sound horrible and dire. In the “diagnosis” information for each “Yes” answer, make sure that you qualify how serious or non-serious the condition was. As an example, if you were diagnosed with mild anxiety, then don’t enter anxiety, make sure you put the mild qualifier into the diagnosis. Make sure to also tell the insurance company what the treatment was (prescription, therapy, diet, none, etc.) If the information is for a condition that has been resolved and is no longer being treated, then in the “treatment” part of the information, say that the condition is “All Okay”, “Healed”, or “Issue Resolved”. When the application asks for the beginning and ending dates for the condition, you need to be as accurate as you can, usually a month and year is sufficient (if you aren’t sure of the date, give the best estimate you can). If you are still being treated for something, then the end date will be the date you are filling out the application, and you’ll want to indicate that you are continuing to receive treatment in the “treatment” part of the information.
The last items to be aware of are the sources of information that the health insurance companies will look at when reviewing your application. All insurance companies have access to the Medical Information Bureau (MIB), and every insurance company reports its findings to this online database. So if you applied for insurance in the past, there are records there that show what the results of those applications were. Your medical records do not show up in the MIB, but your application gives the insurance company the ability to request a copy of your medical records from your doctor. If your answers require extra information, then many times the insurance company will request a copy of your records to check on specific details, such as lab readings, diagnosis, or biopsy findings, etc.. So it’s critical to disclose important information on the application, because if the insurer pulls your medical records and finds that you did not disclose information, they may decline your application.
On a side note, Chiropractic and Acupuncture (CaA) treatments need to be handled with care. If the CaA treatments were for a specific injury and lasted for only a specific period of time, then they should be disclosed on the application. If you use CaA treatments for “General Wellbeing” and these visits have not been submitted to an insurance company for reimbursement, then you should not disclose this on the application. The reason being that the insurance companies view these ongoing treatments as something that is hiding an underlying issue, and they don’t want to pay to treat those phantom injuries once you decide that CaA isn’t resolving the problem. I’ve seen too many people get declined for putting this on their application.
After you submit the application, you might receive a call from a nurse working for the insurance company, to ask you more questions about some of the information on your application. This is becoming very normal now and is not something you should be worried about. In fact this can be beneficial if you aren’t able to put enough details into the application. During the nurse interview you can cover this additional information.
With these tips you are now ready to click on the “Apply Now” button and begin filling out your medical insurance application. During the process if there are any questions that you are not sure about, please call us, and one of our advisors will help you.
back to Table of Contents