Health Insurance

Health Insurance 101: Intro to Networks

Hey Guys! Quick recap on what you should already know before we hit the ground running on NETWORKS. 

There are three essential components you should know and feel comfortable with when selecting a health insurance plan:

Three key essentials:

  • Cost Sharing
  • Benefits/Coverage
  • Networks

The gist: you need to find a health insurance plan that includes the BENEFITS, or medical services, that you need with the NETWORK of doctors and hospitals that you want to see with a COST SHARING setup that fits your budget.

Networks: the doctors and hospitals that will be covered and will “accept” your insurance plan, or in simplified terms, who you can see for less $$$.

Like I said… it’s very important that you review the network of doctors and hospitals included in the health insurance plan to make sure it includes the doctors you want to see.

Let me give you an example that I went through when selecting my dental plan…

My dentist is Dr. Ted and I’ve been going to him for years. Dr. Ted is the BEST dentist around- he’s friendly, he’s funny, he’s motivated by helping people, and heck I’ve never gotten a cavity (knock on wood!) Now when I started a new job and had to select my dental plan I had two options- HMO or PPO. So what did I do? I checked to see if Dr. Ted was in both networks. PPO networks are typically much larger than HMO networks and it turns out that Dr. Ted is in the PPO network but not the HMO network. Conclusion made– I’m selecting the PPO because for me I would rather pay more money for the PPO and get the high-value service from my current dentist who knows my teeth well.

The same applies to any plan you select, whether health insurance, dental, or vision insurance!

Make sure your doctors are -in network-

Now, this doesn’t limit you from seeing doctors who are “out-of-network”. Most of those doctors will still see you but if you are in an HMO you typically become a cash-paying patient where you have to pay for all services by yourself (“out-of-pocket”- remember that term??) with no help from the insurance plan you are currently paying for. If you are in a PPO the insurance may still cover some of it but it will be much more expensive than seeing an “in-network” provider.

Any questions on NETWORKS? Feel free to comment below and I look forward to seeing you next time when we chat about BENEFITS!

Cheers to Health and Happiness!

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Health Insurance

Health Insurance 101: Intro to Cost Sharing

Hello Everyone! I’m excited to continue on our Health Insurance 101 journey and get into the nitty-gritty of what you need to know about health insurance!

To give a quick recap, there are three essential components you should know and feel comfortable with when selecting a health insurance plan:

Three key essentials:

  • Cost Sharing
  • Benefits/Coverage
  • Networks

The gist: you need to find a health insurance plan that includes the BENEFITS, or medical services, that you need with the NETWORK of doctors and hospitals that you want to see with a COST SHARING setup that fits your budget.

Today we are going to hone in on COST SHARING. Now, what the heck does that healthcare lingo mean??

Cost Sharing: the amount of money you must pay for medical care vs what the insurance company will pay, or in simplified terms, the $$$.

Cost sharing will differ both between health insurance plans (health insurance plan X will cost more for me over the entire year than health insurance plan Y) and within the health insurance plan itself, for example, you may have to pay more for an emergency room visit than a clinic visit. Let me explain in further detail…

Let’s start with some basic definitions of the $$$ terms you need to know:

Deductibles: the amount of money you must pay out-of-pocket before your insurance kicks in and covers any other medical services

Premiums: the monthly payment you make to have health insurance coverage

Copayments: a defined amount you pay per medical encounter

Coinsurance: a percentage of your medical bill that you pay

Out-of-pocket: this means the insurance won’t cover the cost and you pay for everything yourself (i.e. you pull your wallet out of your pocket… get it…)

Summary of Benefits and Coverage: this document lays out your benefits (which we will talk about in another episode) and the cost sharing associated with those benefits. Know and love this document- even though it looks frightening!

So a basic life scenario with COST SHARING goes something like this…

Every month starting in January I pay a monthly PREMIUM to the health insurance company so that I have health insurance. Let’s say in January I get my annual preventive checkup with my doctor but that has NO COST SHARING (yay!) because it is preventive care that the health insurance covers (check with your insurance to confirm). Then in March I break my foot and have a hospitalization costing $50,000. My DEDUCTIBLE is $5,000 (the amount I must pay before health insurance kicks in) and I also have a $250 COPAYMENT for the Emergency Room (ER) visit and $250 COPAYMENT for the hospitalization. Therefore, I owe $5,500 in medical bills (DEDUCTIBLE + COPAYMENTS) and the insurance will cover the rest. But don’t forget you still also have the cost of your PREMIUM that you pay on a monthly basis! Then I have a follow-up clinic visit with my doctor in April to make sure my foot is doing ok and I have a $20 COPAYMENT for the clinic visit…you get the picture!

Additional key points and recommendations:

  • As you can see health care and your portion of the cost sharing can be expensive. Make sure you have enough money in your savings to cover any emergencies!
  • Review your Summary of Benefits and Coverage so you know how much different types of care costs. For example, it is probably more expensive for you to visit the ER than for you to go to an urgent care clinic. It is probably more expensive for you to get a brand-name prescription instead of a generic. Review and know!!  
  • AVOID COINSURANCE! You want to pick plans with copayments instead of coinsurance because you have minimal control over the size of your medical bills.

Let’s take the above example with COINSURANCE instead of COPAYMENTS. Let’s say my COINSURANCE is 20% of my hospital stay. Then I have my $5,000 DEDUCTIBLE plus $10,000 COINSURANCE (20% of $50,000) which leaves me paying $15,000 instead of $5,500. Yikes- AVOID COINSURANCE!

Now that we have gone through all the key Cost Sharing terms and example scenarios, let me know if you have any additional questions about the $$$ and I can be sure to address! Cheers to Health and Happiness!

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Health Insurance

The Three Essentials of Health Insurance

Hi Everyone!

Today is the special day everyone has been waiting for- to learn the key essentials that you need to know about picking your health insurance plan!

There are three key essentials:

  • Cost Sharing

  • Benefits/Coverage

  • Networks

I’ll touch on each of these briefly here but then we will go into more depth in each of the following episodes so be sure to follow along!

Here are the basics you should know and understand before we move on into the complexities:

Cost Sharing: the amount of money you must pay for medical care vs what the insurance company will pay. Cost sharing will differ both between health insurance plans and within the health insurance plan itself, for example, you may have to pay more for an emergency room visit than a clinic visit. We will get into more details in a separate episode but for now, think the $$$ you have to pay.

Benefits/Coverage: which medical services you can receive that will be covered under the health insurance plan. This ranges from who is providing the service (midwives, physical therapists, chiropractors, etc.) to where the service is provided (in the hospital vs outside the hospital in a clinic, skilled nursing facility, etc.) to how long the service can be provided (length of hospital stay for having a baby). We will get into more details in another episode but for now, think what you get for your $$$.

Networks: the doctors and hospitals that will be covered or who will “accept” the insurance plan. This doesn’t mean you can’t go to someone who is “out of network” but it means your insurance won’t cover it and you will need to pay all the medical bills yourself, what we call in the industry “pay out-of-pocket”. We will get into more details in another episode but for now, think who you can see for less $$$.

So here’s the gist: you need to find a health insurance plan that includes the BENEFITS, or medical services, that you need with the NETWORK of doctors and hospitals that you want to see with a COST SHARING setup that fits your budget.

Any questions on these three essentials of health insurance? Let me know in the comments below! Otherwise, I’ll see you in our next episodes where we delve into each of these in turn!

Cheers to Health and Happiness! 

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Health Insurance

Intro to Health Insurance 101

Hello Ladies and Gents! It is officially that time of year (not just the flu season…not just the holiday season…) but it’s time to select your insurance plan for the 2018 calendar year!! Very exciting stuff!

Now I’m sure you must be looking at the options and thinking… “What the heck do these words mean?” “Which plan is the most cost-effective for me and my family?” “Which plan is going to cover the health care that I need?” Maybe you are even thinking “Where the heck do I even start??”

I’m here for you!!! 

Throughout the next few weeks I will post about the basics of the health insurance system so that you feel more confident in the decisions you are making about which health insurance plan to select.

First important point to make:

Make sure you have health insurance! Just one accidental hospitalization can cost up to six figures so if you don’t have that money in the bank you should get health insurance!

Hopefully someday soon it will be easier for everyone to have health insurance but right now it is still really tricky. Here are some recommendations based on your potential situation:

  • If you work for a large employer that’s great- you can take the offered insurance and cover as many members of your family that you can.
  • If you are under 26, you can have your parents claim you on their health insurance. The only requirement is age so don’t worry if you don’t live with them, are married, etc.
  • If you are not offered insurance through your employer, you can go to your state’s health insurance exchange website. (See links below)
  • If you are an independent young adult who is not offered insurance through your job or your parents and you are very healthy, you can go onto your state health insurance exchange website, just like I mentioned, but you can opt for a very lean health plan that is inexpensive. That way you are covered if something should happen and you avoid the tax penalty at the end of the year for not having insurance.
  • If you are over 65 or have kidney failure, sign up for Medicare!
  • If you are not offered insurance through your employer and are having trouble financially affording health insurance, you can check your state’s Medicaid requirements. You may be eligible for insurance based on your current situation. If you have children, they may be eligible for the Children’s Health Insurance Program (CHIP).

Here are some links to help you navigate purchasing health insurance if your employer doesn’t offer it:

https://www.healthcare.gov/ -This site will lead you to your state-based health insurance exchange that I mention above. Click on “Find Local Help”.

https://www.medicare.gov/ -Here’s where you can sign up your parents, grandparents, or other loved ones for Medicare.

https://www.medicaid.gov/ -Here’s the site where you can learn about Medicaid and CHIP and whether your current financial status allows health insurance coverage for you and your family.

And on a side note, you might be wondering about this tax penalty…

The concept here is that all individuals across the country should have health insurance- both for their own health but also for the sake of the risk pool and societal contribution (which I’ll explain in a different post once we get through the basics).

If you can afford health insurance but choose not to buy it, you may pay a fee called the individual shared responsibility payment. This is typically called the “tax penalty” or “individual mandate.”

For the 2017 plan year, the fee is calculated 2 different ways – as a percentage of your household income or per person. You’ll pay whichever is higher. The fee is 2.5% of household income or $695 per adult + $347.50 per child. 

Ok, everyone! It’s time to get out there and purchase your 2018 Health Insurance Plan! The market closes in December!

This is just the beginning of the Health Insurance 101 series so please feel free to send questions below or through the website contact page so I can be sure to address them in future blogs. Together we can simplify the health insurance complexities!

Cheers to Health and Happiness! 

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