HEALTH INSURANCE – THINGS TO CONSIDER WHEN CHOOSING YOUR COVERAGE

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Here we are once again entering that time of year where we all begin to select our yearly insurance plans at work. I am guessing open enrollment is already here or is coming for many of you just as it is for me. Working in medical billing this is something that I am passionate about helping others with everyday. I hate to see the devastating costs associated with lack of knowledge or planning. Many people simply do not know enough about their Insurance coverage or what really is the best plan for them.

To be completely honest every plan is so different that it is impossible to explain each policy correctly to you in a post. This is why I will just give you the basics today and a few reminders that may be important as you select your coverage. I wanted to simply provide you with some insight into making these decisions that I always try to consider. This post was not created to advise you of what plans that you should select at this time. When you leave this page I am hopefully that you will then no where to go to make the best decision on which plan is right for you.

A few of the basics about your insurance coverage

What is a Deductible?

A deductible is the amount you pay for health care services which are approved covered services before your insurance plan starts to pay. A $ 1,000 deductible, for example, you pay the first $1,000 of these services covered by your plan out of your own pocket.

What is a Coinsurance?

The percentage of costs on a healthcare service that you must pay which is determined by each individual policy. Let’s say that your percentage is 20% which is pretty typical, this will be the coinsurance amount owed by you after you have met your yearly deductible amount.

What is a Copayment?

A specific amount set by each insurance company and paid for by the patient/subscriber at each doctor’s office visit, urgent care, ER, with each prescription refill, etc. This is a set amount owed by the patient before the insurance picks up their portion. Just for example: when visiting a family physician you may pay $15 each visit and for a specialist your coverage may require a $30 copay.

Be careful opting out of coverage or simply choosing the lowest priced coverage.

I highly encourage you not to opt out on Insurance coverage. Unless someone else is covering you under their insurance plan, this is not usually a good decision. You should also not simply chose the cheapest policy without any further consideration to what your healthcare will cost you in the long run. You cannot predict the future and this can be a very costly mistake. Consider whether you would have the money to cover an expensive financial disaster on your own. The costs associated with having no Insurance coverage can be devastating. In the event that you should fall ill or get injured, you could end up in a terrible mess financially. These costs can be far more detrimental to your financial life than the savings you could experience each pay check.

Why do I feel so strongly of this and why do I warn you?

Trust me. I know first hand from my own experience that this can be a bad choice. I was in my early twenties and I felt that I was overall pretty healthy. I almost opted out of insurance coverage that year and was warned similarly so I selected the cheapest coverage possible. That year it was discovered that I had Sick Sinus Syndrome a heart condition requiring me to have a pacemaker placed. This was a lesson learned the hard way prompting me to warn others of this type of decision. Is it really worth the devastating financial consequences that you may experience if you choose to opt out or choose the lower plan? I also give you this warning as someone who works in medical billing and sees the devastating consequences frequently now in my line of work.

What do I think is important to consider when choosing the right plans this year?

  1. Benefits advisors or counselors….. If you are offered the opportunity to meet with a benefits counselor, you should absolutely schedule an appointment. You and I do not have the knowledge that these professionals have to offer and this meeting can save you significantly. Should you find that you have any questions regarding the policies available and the best options for you. Meeting with a benefits counselor would offer you the ideal situation to get some of those questions answered.
  2. Carefully consider your coverage options…… High deductible plans may actually be the best option in some cases. For example: If you meet the deductible each year or you expect to to use your insurance coverage a lot. The percentage owed towards coinsurance may be covered at 90% with the high deductible plan leaving the remainder owed by you after the insurance processes at 10%. The other plans offered may cover only 80% or 60% depending on the plan. This can equal a much larger out of pocket costs, than what that high deductible would have cost you. In situations where you utilize the insurance more frequently throughout the year a plan like this may be beneficial. If you are worried about paying the high deductible, start planning ahead and put away some extra savings that would help cover the deductible cost.
  3. Will you need the extras?…… Most companies offer dental, vision, accident coverage, life insurance coverage, cancer or critical illness coverage, hospital indemnity, etc. some of these can really benefit certain people in certain situations. If you foresee needing any of these or have any questions on signing up for any other plans in addition. This is where I will once again encourage you to be sure to meet with a  benefits counselor and ask questions.
  4. Do you have a Preexisting condition?…..I want to highly encourage you to find out before signing up for any additional coverage offered if there is a preexisting clause. What this means is you need to know whether a preexisting condition can disqualify you from the benefits of the plan you are choosing.
  5. Is a FSA, HRA or HSA an option?……When you have are given the option to put money into a FSA (Flexible spending account) be sure to ask questions on what you can use the funds in this account for. If you have a HRA (Health Reimbursement Account) or HSA (Health Savings Account) for your medical coverage, this may also be a valid question. At my current job I have both and FSA and a HRA. These policies both have an account set up with funds deposited to help pay my out-of-pocket costs. There are stipulations to what these funds can be used for and how you can gain access to them. Gather as much information as possible if you are considering either of these plans. You want to know in advance how you can access the funds? You also want to know what these funds can and cannot be used on?

Here are just a few other important things that you may want to consider when selecting new coverage this year. ten-questions-health-plan#1

Any questions that you have regarding your own personal coverage options available I highly encourage if a benefits representative or counselor is available to schedule an appointment. Make a list of questions to ask when you go to meet with them and do not hold back asking questions even if you think it might be unimportant. If you have questions regarding procedures or services covered after you have enrolled contact the Insurance company directly and they should be able to provide details specific to your plan.