Health Insurance Plans In Difficult Economy
If you are purchasing health insurance in today’s bad economy then here are 5 five things which you must look out for.
1. Will your health plan cover you both at work and away from your job?
Many health insurance policies carry specific exclusions which eliminate your benefits for anything that could have been covered by Workers Compensation or similar laws. Now take a minute to read that last sentence once again and pay particular attention to the words ‘could have been covered’. That is right, most self employed people and even some small business owners do not carry Workers Compensation on themselves.
There are insurance policies that provide cover on and off the job 24 hours a day, as long as the law doesn not require you to have Workers Compensation coverage.
2. Are you writing off your health insurance premiums?
Independent contractors (1099’s), home based business owners, professionals and a lot of self employed individuals are not taking advantage of the tax laws available to them.
Many people who are paying all of their own costs are entitled to deduct their monthly insurance premiums. This by itself can reduce your net out-of-pocket costs by up to 40%. Ask your accountant if you are eligible or check out the IRS website for more information.
3. Look carefully at any plan’s internal limits
All health insurance plans use some sort of internal controls which determine how much the company is prepared to pay out for a specific procedure or service. Here there are two basic methods:
A. Scheduled Benefits
Many policies, some of which are specifically marketed to self employed and independent people, have a clear schedule of how much the insurance company will pay per visit to the doctor, hospital stay or even what payment limits are imposed for testing within a 24 hour period. This structure is normally associated with ‘Indemnity policies’. If you are offered one of these plans make sure that you see the schedule of benefits in writing. It is very important that you understand these limits because once you reach them the insurer will not pay any costs above the stated amount.
B. Usual and Customary Expenses
‘Usual and Customary’ refers to the rate of pay out for a doctor office visit, procedure or hospital stay that is based upon what most physicians and facilities charge for a particular service in that geographical or comparable area. ‘Usual and Customary’ charges represent the maximum level of coverage on most major medical plans.
4. Do not forget that you are able to shop around
If you are reading this you are probably shopping for a health policy.
Each day people shop for everything from groceries to a new house and during the shopping process value, price, personal needs and general market conditions are evaluated by the buyer. Bearing this in mind, it seem very strange that the majority of people never ask what a procedure, test or even doctor visit is going to cost. In this constantly changing insurance market it will become more and more important for these questions to be asked. Inquiring about price will help you get the most from your plan and reduce your out-of-pocket expenses.
5. Pay attention to networks and discounts
Almost all insurers work with medical networks in order to access discounted rates. In broad strokes, networks are composed of of medical professionals and facilities who agree to charge discounted rates for services provided. In most cases the network itself is one of the defining attributes of your program. Discounts will generally vary from 10% to 60% or more.
Medical network discounts vary but in order to make sure that you pay the lowest out-of-pocket expenses, it is vital that you check out the network’s list of physicians and facilities before committing yourself to a plan. This is not only so that you can ensure that your local doctors and hospitals are part of the network, but also so that you can see what your options would be if you need referral to a specialist.
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