5 Important Facts About Taking Out Health Insurance Policies In A Poor Economy
If you are looking to purchase health insurance in today’s bad economy then here are 5 five things which you ought to watch out for.
1. Does your plan provide you with cover both at work and away from your job?
Many health insurance plans have specific exclusion clauses that wipe out your benefits for anything which could have been covered under Workers Compensation or a similar law. Now take a moment to read that last sentence again and pay particular attention to the words ‘could have been covered’. That’s right, most self employed people and even some small business owners do not carry Workers Comp on themselves.
There are specific insurance plans which will cover you on and off the job, as long as the law doesn not require you to have Workers Compensation coverage.
2. Are you writing it off?
Independent contractors (1099’s), home based business owners, professionals and many self employed individuals do not take advantage of the tax laws.
Many people who are paying 100% of their own costs are entitled to deduct their monthly insurance premiums. Just that alone can lower your net out-of-pocket costs by up to 40%. Ask your accountant whether you are eligible or take a look at the IRS website to get more information.
3. Look closely at any plan’s internal limits
All health insurance policies have some form of internal controls which are used to determine how much the company will pay out for a specific service or procedure. Here there are two basic methods which are used:
A. Scheduled Benefits
Many policies, some of which are marketed specifically to indpendent and self employed individuals, have a clear schedule of how much they will pay per doctor office visit, stay in hospital or even what payment limits are imposed for testing within a 24 hour period. This structure is frequently associated with ‘Indemnity plans’. If you are offered one of these policies be sure to see the schedule of benefits in writing. It is important that you understand these limits up front because once they have been reached the insurer will not pay any expenses over 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 which is based upon what most physicians and facilities charge for that particular service in that geographical or comparable area. ‘Usual and Customary’ charges represent the highest coverage on almost all major medical policies.
4. Don’t forget that you are able to shop around
As you are reading this there is a fair chance that you are shopping for a health plan.
Each day people shop for everything from food to a new home and during the shopping process value, price, personal needs and general market conditions get evaluated by the buyer. Bearing this in mind, it seem very strange that the majority of people never ask how much a test, procedure or even doctor visit cost. In today’s ever changing health insurance market it will become increasingly important for for people to ask these questions. Inquiring about price will help you get the most out of your plan and reduce your out-of-pocket expenses.
5. Look out for networks and discounts
Nearly all insurers work with medical networks to obtain discounted rates. In broad strokes, networks are made up of of medical professionals and facilities who contract to charge discounted rates for services provided. In many cases the network itself forms one of the defining attributes of your program. Discounts will generally vary from 10% to 60% or more.
Medical network discounts do vary but to ensure that you pay the lowest out-of-pocket expenses, it is imperative that you preview the network’s list of doctors and facilities before you commit yourself to a policy. This is not only to ensure that your local hospital and doctors are part of the network, but also to see what your choices would be if you need referral to a specialist.
Follow these tips and you will get cheap health insurance that provides you with the level of cover you require.
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