Health Insurance Information and Recommendations

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:

1. Office Visit Co-pays
2. Deductible Amount
3. Out-of-Pocket Maximum
4. Prescription Benefits

Office Visits

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

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.

Out-Of-Pocket Maximum

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.

Prescriptions

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 (~25%) or a Silver (~65%) 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.

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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.

Consumer Classifications

Invincibles

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.

Pre-65 Retirees

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.

Pre-Existing Conditons

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.

Application Tips – Position Your Application For Approval

You’ve decided what health insurance plan to apply for, so you prepare to click the “Apply Now” button and begin the application. Before you do that, stop for a few moments and make sure you have all the information you need.

If you are applying using a special enrollment period, then you will need to make sure you have the necessary supporting documents to prove you have a valid qualifying event. We can help make sure you have the right documents, so just call us.

For all applications, you will need social security numbers and birth dates for each member of your family. Both PPO and HMO plans now require that you select a Primary Care Physician, so you’ll need to have the correct spelling of your doctor’s names, and in some cases you’ll also need the provider id number for your doctor.

The online applications are fairly simple now. The insurance company simply wants to know what plan you want, where you live, and how are you going to pay for the premiums. The process should be easy.

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.

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