Health Plans: Confused by all of your options?

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Your medical history, current health, and lifestyle choices influence your costs for health insurance.

Pre-existing conditions like chronic illness or diabetes can increase your premiums and may also be subject to “waiting periods” before you benefit from coverage.

Lifestyle choices such as smoking will increase your premiums.

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If you want lower premium payments, opt for high deductible plans.

Choose a co-payment plan – the premium is lower but you pay a percentage of costs for services you receive. Consider the monthly premium costs along with additional out-of-pocket expenses for care.

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Insurance companies employ actuaries who calculate the framework for determining insurance premiums.

Underwriters will calculate your particular premiums based on a variety of factors including your health status and history, lifestyle choices, and age.

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In addition, your premium costs will vary based on several coverage variables:

Deductible amounts –The total amount of money you need to pay before your health insurance provider takes over. These are usually set on a yearly basisMany insurance companies offer high deductible plan options, which will likely lower your monthly premiums.

Co-insurance – This is how you and your insurance provider share the costs of your medical costs. They are usually described in terms of percentages.– Example, Insurance company pays 80%, you pay 20%

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Copay - The amount that you pay towards your medical bill. It is your share of the costs. They are usually described as set dollar amounts. Copay amounts vary according to your policy and can change within a policy if, for example, you – Seek treatment outside of your network, or choose to see

a specialist; or– Choose brand drugs over generic drugs

Out-of-pocket maximums – An out-of-pocket maximum is the dollar limit that you will be responsible for during the course of the policy term. This amount typically includes deductibles, co-payments, and co-insurance but not premiums.

Lifetime maximums – this is the maximum amount your insurance company will pay in your lifetime for your policy.

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Economists tell us that rising health care costs directly correlate with significant drops in health insurance coverage.

A study by Harvard University researchers showed an average out-of-pocket medical debt of $12,000 for individuals who filed for bankruptcy. The study also found that 50 percent of all bankruptcy filings were partly the result of medical expenses.

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Every 30 seconds in the United States someone files for bankruptcy resulting from the aftermath of a serious health problem.

Medical expenses can lead to housing trouble. Many consumers can’t pay their mortgage or get credit approval due to outstanding medical debt.

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Network coverage refers to medical services covered by a defined group of physicians, caregivers and facilities, who are all pre-approved through your health care plan.

When you use the services offered by the pre-approved providers you are using “in network” services.

There are two different types of plans to choose from: managed care plans and indemnity plans.

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Managed care plans (HMOs, PPOs, POS plans, and EPOs) have negotiated agreements with specific doctors, hospitals and health providers. Managed care plans typically involve the insurance company directly reimbursing providers for claims that you incur.  

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By using the provider network for medical services, you qualify for the special rates and range of services outlined in your policy.

With certain types of managed health care coverage such as HMOs, you’ll be asked to select a primary care physician from a roster of doctors who belong to the provider network.

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Managed care plans have negotiated agreements with specific doctors, hospitals and health providers. This pre-approved group is referred to as the provider network.

When you use a doctor in a provider network you are using “in network” services. For their services you inquire a lower out-of-pocket cost than if you had an indemnity plan, which does not rely on provider network agreements.

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When you have a managed care plan, your network of preferred or participating providers make all decisions for your health care needs, including—with HMOs—referrals to obtain specialized medical care.

If you opt to go outside the network for medical services, you will likely be responsible for part or all of the associated fees for the service, regardless of whether or not you have reached your in network out-of-pocket maximum.

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Health insurers use Usual, Customary and Reasonable (UCR) expenses to determine reimbursement rates and to prevent doctors or hospitals for overcharging for services. UCR costs reflect the average total costs for medical services or doctor visits. UCR refers to:

Usual: The usual fee is the cost of services regularly charged to all patients for a specific type of service. The fee can change if the patient makes an appointment to be treated for one condition, but complains of other problems that must be addressed during the visit.

What are UCR Expenses?

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Customary: A customary fee is comparable to fees charged by health care providers offering the same services and who meet the same criteria for comparison.

Reasonable: A fee is considered reasonable when it meets both the usual and customary criteria. A reasonable fee may also be determined on a case-by-case basis by the insurer.

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1. Comparison shop for tests. As costs for tests can vary greatly between different facilities.

2. Haggle over the hospital bill. Hospitals may be willing to reduce an account balance if the patient can demonstrate that the payment of a co-pay or deductible is a hardship. If you don’t ask for it, you won’t get it.

3. Eliminate unnecessary follow-up appointments. Question whether or not you need a follow up appointment or if it can be handled with a simple phone call.

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4. Inquire about less expensive prescriptions. When prescribed a name brand prescription, ask if a generic will suffice.

5. Talk prices directly with your doctor. If you are experiencing financial hardship, talk directly with your doctor about getting a reduction in your bill.

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We Promise: To give you the best results for YOU, we never promote one carrier

over the other. We just assess your needs and show you the best options from national carriers with plans in your area.

Our Commitment is to YOU: As a division of The Word & Brown Company who has been the

leading source for small group health insurance for over 20 years, we have leveraged technology to build an easy-to-use research tool, supported by a world class customer service team.

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