Choosing a Health Insurance Plan
Please note: Information on this page is believed accurate at the time of publication. However, it is subject to state and federal laws and regulations, which can change frequently. Please contact an Einstein Advisor for the most current data and options available to you.
The rising costs of health-care have made health insurance more important than ever before. Many Americans receive affordable group coverage through their employment. However, people who are not currently covered by their employers have few affordable sources for group coverage currently.
Sources of Coverage
The Affordable Care Act (ACA) created insurance “marketplaces” that offer coverage to individuals who aren’t covered through an employer’s group plan. Through the Marketplace, individuals and families may qualify for tax credits to help pay part of the cost of insurance. Plans purchased through the Marketplace must meet ACA requirements including coverage for pre-existing conditions.
In some areas, insurance carriers offer private insurance plans that are not compliant with all ACA requirements. While these plans may come with lower monthly premiums, they are not guaranteed to cover pre-existing conditions and other ACA requirements, and they do not qualify the policy owner for tax credits to help pay the premiums.
For individuals who qualify for Medicare, there are many plans available from numerous insurance carriers. To qualify for Medicare, an individual must be over 65 years of age or meet specific disability requirements. To qualify at age 65, you must have paid into Medicare for at least 40 calendar quarters. It’s important to note that only an Independent Insurance Agent, like those at Einstein Advisors, can present options from many different carriers. If you call a carrier’s 800 number or a carrier’s captive agent, they can only present options from one company.
For more information about your Medicare options, click here to visit our Medicare page.
Medicaid is health insurance coverage provided by the state and federal governments for individuals who live at or near the national poverty level. Please note that there are special insurance plans available to people who qualify for both Medicare and Medicaid. An Einstein Advisor can help you determine if you are eligible and help you apply.
Types of Coverage
There are three general classifications of medical insurance plans: fee-for-service (indemnity), managed care (e.g., HMOs and PPOs), and high-deductible health plan (HDHP)
Fee for Service (Indemnity Plans)
With a basic fee-for-service (indemnity) insurance plan, either you or your health-care providers are paid a fee for each service provided to insured patients. Indemnity plans typically require the payment of premiums, deductibles, and coinsurance. Limits on certain coverage or exclusions may apply.
Managed-care plans provide a way to help control rising medical costs. In managed-care plans, insurance companies contract with a network of healthcare providers to provide cost-effective health care. Managed-care plans include health maintenance organizations (HMOs), preferred provider organizations (PPOs), and point-of-service (POS) plans.
Health maintenance organization. With an HMO you normally pay a monthly premium in addition to a small copayment for a visit to a physician, who is “in the network” of the HMO. The HMO requires each member to choose a primary-care physician from their network of doctors, and to obtain a referral before seeing a specialist. Because HMOs contract with health-care providers, costs are typically lower than in indemnity plans.
Preferred provider organization. Like an HMO, a PPO is a managed-care organization of physicians, hospitals, clinics, and other health-care providers who contract with an insurance company to provide health care at reduced rates to individuals insured in the plan.
The insured can see any health-care provider within a preferred network of providers and pays a copayment for each visit. Although insured individuals can choose providers outside the plan without permission, patient out-of-pocket costs will be higher; for example, the initial deductible for each visit is higher and the percentage of covered costs by the insurance company will be lower. Because PPOs provide more patient flexibility than HMOs, they may cost a little more.
Point-of-service plan. A POS health-care plan is a sort of hybrid between PPO and HMO. POS plans recommend that patients choose a primary care physician from inside the network. That physician can refer patients to other physicians and specialists who are inside or outside the network. Insurance companies have a national network of approved providers, so insured individuals can receive services throughout the United States. Copays tend to be lower for a POS plan than for a PPO plan.
High-Deductible Health Plans
An HDHP provides comprehensive coverage for high-cost medical bills and is usually combined with a health-reimbursement arrangement that enables participants to build savings to pay for future medical expenses. Some HDHPs cover preventive care. However, these plans have higher annual deductibles and out-of-pocket limits than other insurance plans, often several thousand dollars.
Participants enrolled in an HDHP can open a health savings account (HSA) to save money that can be used for current and future medical expenses. There are many options to consider when opening an HAS, including tax considerations and investment options.
Remember that the cost and availability of an individual health insurance policy can depend on factors such as age, health, and the type of insurance purchased. In addition, a physical examination may be required.
Medicare is the U.S. government’s health-care insurance program for the elderly. There are many options available to beneficiaries throughout the country, and your options will depend upon what’s offered in your specific area. Medicare coverage comes in three basic forms:
- Original Medicare
- Medicare Advantage Plans
- Medicare Supplement Plans
For details about these options, visit our Medicare Page, or contact us for a free consultation.
Affordable Care Act (ACA)
The Patient Protection and Affordable Care Act (ACA) is sometimes called “Obamacare” and it was designed to help individuals who are not covered by employer-sponsored health insurance, Medicare, Medicaid, or another government program. ACA plans are required to include “minimum essential coverage” and cannot refuse coverage for pre-existing conditions. If you’re 30 or older and want to enroll in a “catastrophic” plan for 2019, you must claim a hardship exemption to qualify. A catastrophic health plan offers lower-priced coverage that mainly protects you from high medical costs if you get seriously hurt or injured.
Of course, the ACA and Medicare have seen changes in recent years, and may well see more changes in the future. To receive the most current information regarding your insurance options, contact one of our independent insurance agents for a free consultation.