State of Insurance

If you are like me and self-employed, health insurance has been a bit of a challenge for the past -7-ish years. The Affordable Care Act (ACA) has not necessarily been favorable to us. Thankfully, the insurance companies I work with have affordable options which have been saving people between 30-50% and sometimes more than the ACA market place plans. SO…. how is 2019 going to look?

First, I am not going to concentrate on ACA plans, or the very few off-marketplace ACA compliant plans, for the reason that they are simply not affordable for the healthy individual especially as they will be increasing in premium again for 2019. Also, the individual mandate tax is exempt under the hardship exemption in 2018 for counties that have only one ACA provider (all of Arizona) and for everyone for year 2019 and forward…. that is GREAT news! This allows people, who qualify medically, to have the freedom to choose affordable health insurance options.

I want to begin with the explanation of major medical plans.  The general public has been accustomed to major medical plans, however, many people do not understand what that means. The simple definition of a major medical plan is where you have a deductible, co-insurance and a maximum cost out of pocket before you receive 100% insurance payment… In other words, you pay a lot of money up front in some cases to get to use your insurance (Don’t forget to factor in the monthly premium amount.)

News flash… the only major medical plans available today for individuals with private health insurance are ACA qualified plans and/or grandfathered plans that were in place prior to 2010.

So… what are the choices for private health insurance in 2019, their differences and how do you know if one plan may be better than another?

Hospital Indemnity Plans: These are fixed benefit hospital and surgery plans that are not considered major medical plans. They are medically underwritten through a health questionnaire. They provide fixed-indemnity after the deductible, if any, for medical expenses, covered surgery, hospitalization and may have options for chemotherapy and radiation services, critical illness and supplemental accident medical expense. The indemnity plan I have found to be have the best benefits is:

• a permanent plan with
• has a rate lock on the premium
• has no caps or limits on annual benefits
• has a nation-wide PPO network
• can’t force anyone off the plan for any medical reason
• has optional doctor visits and well care.

It is important when reviewing indemnity plans to research out these key benefits to ensure you are receiving the best benefits for your premium dollar. Permanent Indemnity plans are an excellent choice for individuals/families that are healthy, looking for a reasonable premium with equitable insurance payouts and want the security of having a premium rate lock. They provide some certainty in an uncertain health insurance market.

Short-Term Medical Plans: These plans can range in length from 30 – 364 days. They resemble a major medical plan in that they have:

• a deductible
• co-insurance
• maximum out-of-pocket costs before you receive 100% insurance benefit for covered services
• limited doctor visits
• no or very limited well care
• have qualifying medical questions.

The plan can be re-written for a total of three 364-day consecutive terms. (The plans are sometimes called Trump Care.) Short Term Plans are mostly purchased by people: between employment or waiting for employer paid benefits, transitioning from a life event, needing a child-only plan or needing health insurance for any reason for a short period of time, i.e., a 64-year-old turning 65 in five months who is retired from his employer paid benefits. These plans are typically costlier than indemnity plans and have the uncertainty of qualifying for consecutive re-writes.

Combination Indemnity/Short Term Plans:

These are two separate policies with no coordination of benefits. The short term plan typically has large deductibles (sometimes as high as $20,000). The indemnity benefits are applied to covered expenses, and all covered claims go to help the short term medical deductible. The premium is typically costlier than an indemnity plan and/or a short term plan. This is not a permanent plan and the next coverage period is not a continuation of the previous period; it is a new plan with a new deductible, co-insurance and pre-existing condition limitations.

This article was authored by Karla Flores Smith, Area Business Development Leader for InsuranceExperts.team. Karla has been a licensed agent since 2005. Learn more about her.

For more information on specific health insurance plans and options, contact your agent on the InsuranceExperts.team or visit our website at www.insuranceexperts.team