| Health
Insurance Options For RVers
Part 2
By Jaimie Hall
Originally published in the
March/April 2002 Workamper News.
Once you’ve decided on
a state, obtaining affordable individual coverage can be a challenge.
It may be difficult to find a company that will sell you a policy, particularly
if you have a serious medical problem. You may have to prove you are insurable
by getting a medical exam and taking tests that rule out certain conditions
the company does not want to pay for. Premiums for individual coverage
are generally lower than for group coverage but you may get less overall
coverage. Actually, most of you did not pay for all of your group health
insurance and the employer covered at least half the bill or more. So,
it might seem that individual coverage is more expensive. This will certainly
be the case if you are forced to purchase a guaranteed issue plan under
the Portability Act. In a non-guaranteed plan, ompanies may exclude treatment
and prescription coverage for certain conditions which you have had in
the past.
In obtaining coverage, you
need to weigh your medical needs against what you can afford to get the
best coverage for your money. As you may have discovered, the same coverage
in one state can cost more than in another.
The main types of policies
are:
Fee-for-service insurance (indemnity insurance): Traditional
type of health insurance that pays a portion of each medical service you
get, such as doctor’s visits and hospital stays, while you pay the
remaining cost. The insurance company does not begin to pay a portion
of the costs until you pay the deductible. Plans without any deductible
at all are virtually non-existant. Premiums are generally higher than
Managed Care.
Managed Care Plans: Also known as HMOs (health maintenance
organizations) or PPOs (Preferred provider organization). The health insurance
company has contracted with doctors and hospitals to provide services.
You pay a monthly premium and then a small amount for each visit or service
(usually $10-$15) called a co-pay. Some plans allow you to use doctors
and hospitals outside of the plan network but you pay more per visit.
Evaluating coverage
An independent agent or broker can help you compare several companies.
Talk to several to find one you are comfortable with and who offers policies
from several companies. It is generally a bad idea to buy health insurance
from a captive agent. They usually have plans with less than adequate
coverage. This does not apply to other types of insurance. Ask questions
about each policy and make a comparison chart. An agent can answer many
of these questions, but examine the policy itself as well.
- How much of my doctor and
hospital bills will this plan pay for?
- What is the monthly premium?
- How much will I have to pay for a hospital stay before the plan begins
to pay?
- How much will I have to pay for office visits to the doctor?
- Does the plan pay for preventive health care, such as routine checkups?
- Does this plan have rules for people who already have serious, chronic
medical problems? Will this keep me from getting the care I need? A pre-existing
condition should be described as a condition "for which you have
received treatment, medication, or advice in the past six months"
as opposed to having manifested itself for a particular time before the
policy began. In the second case, a company could deny coverage of cancer
because it might have been growing for more than six months even if you
had no knowledge of it.
- If there is a deductible, does it start over each year (preferable)
or for each new illness?
- What services are covered by this health insurance? Will it pay for
visits to the emergency room or urgent care center? Does it cover routine
surgery, hospital stays, doctor visits, skilled nursing facility care,
home health care, and medical equipment and supplies?
- Does the plan cover visits to an eye doctor, dentist (rare) or prescription
drugs?
- Does the plan pay for catastrophic medical costs?
- Is there a yearly or lifetime limit to how much the plan will pay for
medical costs? The lifetime limit should be at least three million dollars.
- Are rate hikes based on individual or pooled claims? (In the case of
pooled claims, the company raises the rates of an entire category, not
individuals.)
- Are rates based on my age at the time the policy is issued (preferable)
or my "attained" age?
- Is the policy Guaranteed Renewable/Non Cancelable (preferable) or is
it just Guaranteed Renewable?
Check out the company
Good agents will give you insight into the companies they recommend. Check
the financial stability of each company by asking for its A.M. Best rating.
It should be an "A" or a "A-." Verify this at the
A.M. Best Web site.
Check also with the State Insurance
Department or Commission about any company you are considering. Make sure
the company you are considering is regulated by your state. If not, the
company may hike rates or drop coverage for those who file "excessive"
claims. Check to see if there is a history in this state of companies
filing for bankruptcy and passing the clients over to a "sister"
company, at higher rates, thus eliminating high risk clients. In some
states, companies will leave the state or stop issuing individual policies
if costs get too high.
Reducing monthly premiums
Companies often offer indemnity policies with differing deductibles. The
larger the deductible, the lower the monthly premiums. The percentage
the company pays after you have paid out your deductible may be either
50% or 80%. If you are relatively healthy and have money in the bank to
cover your deductible if something major happens, you might choose a higher
deductible and the lower coverage. Or, set up a medical savings account
to cover out-of-pocket expenses (check with your tax preparer on eligibility
and how to do this).
Remember that deductibles are
per person. A $5000 deductible for a couple will be considerably less
expensive than two $2500 deductible plans and about 20% cheaper than having
two $5000 deductible plans. Keep in mind that no matter how much you try
to get a better deal, the insurance company has already thought of it
and closed up the loophole.
You may be eligible for group
health insurance at lower rates through a group or association. However,
caution is advised. RVer Shaneen obtained association health insurance
provided by an out-of-state company. Her premiums were jacked up from
$125/month to $1800/month after a bout with breast cancer. She had no
recourse because Florida does not regulate out-of-state companies. In
some states, association policies fall under different regulations as
well. Be sure to check with your state insurance department. In all probablity,
Shaneen purchased an ERISA plan which is a formula for trouble. Florida
doesn't even allow these plans to be sold anymore and is prosecuting the
agents who marketed them. Maker sure the company is an insurance company
that is appointed to do business in the state. That way, even if something
happens, the state guarantee pools will kick in. If it is too good to
be true.. it probably is.
Read and study your policy.
Remember, a lower premium may indicate poor coverage, not savings.
Pre-existing conditions
Individuals with pre-existing conditions will have more difficulty finding
health insurance coverage. Depending on the state, you may be able to
obtain coverage through one of the following ways:
Open enrollment:
Managed care companies in some states must have an open enrollment period
each year where the company cannot consider any pre-existing conditions.
(In Florida this is for valid businesses only. Individuals are not eligible
unless they are self-employed).
Health Insurance Portability and Accountability Act (HIPAA):
This federal law may help you convert your group or COBRA policy to an
individual policy. (If you are over 40 this is expensive. If you are over
50 it is absurdly expensive. If you are over 60 it will kill you just
to hear the premium)
State requirements: A dozen or so states require that
insurance companies offer health insurance to individuals who have not
been able to get health insurance because of their health status even
though they don’t want to cover you. The insurance in these states
is more expensive if you are healthy but much better than HIPAA if you
need the plans.
High-risk pools are available in some states for those
who have not been able to get insurance because of a serious medical condition.
Most of these pools have been converted to Medicaid.
Temporary coverage: You may be able to get a policy for
up to a year that will cover catastrophic expenses such as hospitalization
from an accident. They generally exclude existing or pre-existing conditions
but give some protection. The underwritting for these plans only looks
back three years. So, you might qualify for this plan. However, if you
get sick during the year, you are out of luck when it comes time to renew.
This is a short-term answer.
Check with the state insurance
department to find out if any of these options apply to you.
Part III will provide some
ideas and resources for those with no health insurance.
Resources
A.M. Best Company, the Insurance Information Source. www.ambest.com
National Association of Health Underwriters (NAHU) www.nahu.org an association
of independent health insurance sales agents. Search by state or zip code.
National Association of Insurance Commissioners (NAIC) www.naic.org Find
your State Insurance Department at this Web site and carefully check out
any company.
Dept. of Labor - Pensions and Welfare Benefits: 800-998-7542.
www.dol.gov/dol/pwba/public/health.htm Information about HIPAA.
Finding and Keeping Health Insurance, Free. AARP Publication D17319. Order
from AARP, 601 E St., NW, Washington, DC 20049.
Medical Savings Accounts, IRS Publication 969. www.irs.gov
Go
back to Florida Health Insurance for RVers Part I
© 2002 Jaimie Hall
All pages copyright © 2000, 2001, 2002, 2003 Stephanie Bernhagen
and/or Jaimie Hall unless otherwise noted.
All rights reserved. No reproduction without written permission from the
authors.
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