Truth and Consequences
The immediate effect for most of us will be an increase in insurance premiums. There are dozens of provisions that take place right away (like in 90 to 120 days) that will raise costs of coverage. These include:
• New taxes on medical equipment and drugs that will raise prices for services.
• The so-called "slacker mandate" that will allow "children" to age 26 to stay on their parents coverage. Most people in this age group can get far less expensive coverage in the open market, leaving only the sickest and most expensive to exercise this option.
• The elimination of lifetime caps. This one shouldn't be very expensive, but for reasons discussed below there will be substantial administrative costs involved with compliance.
• Mandatory first dollar coverage for preventive services. This sounds benign, but the law defines "prevention" very broadly to include pretty much everything you might see a doctor about if you aren't actually bleeding to death.
• Minimum loss ratios of 80% for small groups and individual coverage, and 85% for larger groups. Minimum loss ratios encourage excessive spending on services resulting in higher - not lower - premiums.
Because these provisions go into effect within the next six months, health insurers may have to raise premiums in the middle of the year. The premium you or your employer are currently paying was not set to accommodate these additional costs. That means insurers will have to send out notices of even higher rate hikes, and adjust all their computer software to accommodate the new benefits. They will also have to send out new plan documents describing the changes in coverage. This to all 160 million Americans currently covered. That alone will be a substantial new cost that no one planned for.
Plus, there does not currently exist any federal office to oversee these changes in private health insurance contracts. Presumably the new plan documents will have to be filed with someone, but with whom? Nobody knows.
Curiously, because the requirement to accept people with pre-existing conditions doesn't go into effect for several years, there is also a provision to create a temporary national high risk pool, effective June 23, 2010. But no such organization currently exists. They have less than three months to create one. How in the world can they do this (remember, we're talking about the federal government here)? And why did they not simply use the state pools that already exist?
As is often the case with new programs, the "Law of Unintended Consequences" may soon be showing its ugly head.
(Hat tip to Greg Scandlen at "Consumers for Health Care Choices."
AC Forrest is ready to help you navigate these new, murky waters - give us a call or drop an email to us at info@acforrest.com.
Wednesday, March 31, 2010
Here's the current "timeline" for Health Care Reform
Health Care Reform - Timeline
The federal health care reform legislation, known as the Patient Protection and Affordable Care Act, signed by the President on March 23, 2010, and the Health Care and Education Reconciliation Act approved by Congress, signed by the President today, will expand the availability of health care coverage to millions of Americans. While some of the measures will be implemented this year, many don't take effect until 2014 and some extend out to 2020. Below is a high-level overview of the timeline.
2010
New Programs:
* Temporary retiree reinsurance program is established
* National risk pool is created, small business tax credit is established
* $250 rebate for Medicare members who reach the ”doughnut hole”
Insurance Reforms:
* Prohibits lifetime benefit limits – based on dollar amounts
* Allows restricted annual limits on the dollar value of certain benefits
* Coverage rescissions/cancellations are prohibited (except for fraud or intentional misrepresentation)
* Cost-sharing obligations for preventive services are prohibited
* Dependent coverage up to age 26 is mandated
* Internal and external appeal processes must be established
* Pre-existing condition exclusions for dependent children (under 19 years of age) are prohibited
* New health plan disclosure and transparency requirements are created
2011
Insurance Reforms:
* Uniform coverage documents and standard definitions are developed
* Minimum medical loss ratios are mandated
Medicare Reforms:
* Medicare Advantage cost sharing limits effective
* Medicare beneficiaries who reach the doughnut hole will receive a 50% discount on brand name drugs
* A 10% Medicare bonus will be provided to primary care physicians and general surgeons practicing in underserved areas, such as inner cities and rural communities.
* Medicare Advantage plans would begin to have their payments frozen.
Other:
* Employers are required to report the value of health care benefits on employees' W2 tax statements.
* Annual industry fee for pharmaceutical manufacturers of brand name drugs.
* Voluntary long term care insurance program would be made available to provide cash benefit for assisting disabled individuals to stay in their homes or cover nursing home costs. Benefits would start five years after people begin paying a fee for coverage.
* Funding for community health centers would be increased to provide care for many low income and uninsured people.
2012
* Hospitals, physicians, and payers would be encouraged to band together in "accountable care organizations."
* Hospitals with high rates of preventable readmissions would face reduced Medicare payments.
2013
* Individuals making $200,000 a year or couples making $250,000 would have a higher Medicare payroll tax of 2.35% on earned income —up from the current 1.45%. A new tax of 3.8% on unearned income, such as dividends and interest, is also added.
* Medical expense contributions to flexible spending accounts (FSAs) limited to $2,500 a year—indexed for inflation. In addition, the thresholds for claiming itemized tax deduction for medical expenses rise from 7.5% to 10% of income.
* Medical device manufacturers would have a 2.9% sales tax on medical devices; devices such as eyeglasses, contact lenses, and hearing aids would be exempt.
* Eliminates deduction for expenses allocable to Medicare Part D subsidy for employers who maintain prescription drug plans for their Medicare Part D eligible retirees.
2014
Coverage Mandates & Subsidies:
* Individual and employer coverage responsibilities are effective.
* Individual affordability tax credits are created and small business tax credits are expanded.
Health Insurance Exchange & Insurance Reforms:
* State individual and small group health insurance exchanges operational.
* Guaranteed issue, guaranteed renewability, modified community rating and minimum benefit standards (“essential benefits” plan) effective.
* Lifetime and annual dollar limits are prohibited for essential benefits.
* Pre-existing condition exclusions are prohibited.
Taxes & Fees:
* Addition of new taxes on health insurers
Medicaid and Medicare Reform:
* Medicaid expanded to cover low income individuals under age 65 up to 133% of the federal poverty level—about $28,300 for a family of four.
* Minimum medical loss ratio of 85% required for Medicare Advantage plans
2018
Taxes & Fees:
* Tax (“Cadillac tax”) imposed on employer sponsored health insurance plans that offer policies with generous levels of coverage.
2020
Medicare Reform:
* Doughnut hole coverage gap in Medicare prescription benefit is fully phased out. Seniors continue to pay the standard 25% of their drug costs until they reach the threshold for Medicare catastrophic coverage.
If you're confused by this, have questions, or would like to know more about how you or your business will be impacted by all this, just give a "shout-out" to AC Forrest Insurance Group!
The federal health care reform legislation, known as the Patient Protection and Affordable Care Act, signed by the President on March 23, 2010, and the Health Care and Education Reconciliation Act approved by Congress, signed by the President today, will expand the availability of health care coverage to millions of Americans. While some of the measures will be implemented this year, many don't take effect until 2014 and some extend out to 2020. Below is a high-level overview of the timeline.
2010
New Programs:
* Temporary retiree reinsurance program is established
* National risk pool is created, small business tax credit is established
* $250 rebate for Medicare members who reach the ”doughnut hole”
Insurance Reforms:
* Prohibits lifetime benefit limits – based on dollar amounts
* Allows restricted annual limits on the dollar value of certain benefits
* Coverage rescissions/cancellations are prohibited (except for fraud or intentional misrepresentation)
* Cost-sharing obligations for preventive services are prohibited
* Dependent coverage up to age 26 is mandated
* Internal and external appeal processes must be established
* Pre-existing condition exclusions for dependent children (under 19 years of age) are prohibited
* New health plan disclosure and transparency requirements are created
2011
Insurance Reforms:
* Uniform coverage documents and standard definitions are developed
* Minimum medical loss ratios are mandated
Medicare Reforms:
* Medicare Advantage cost sharing limits effective
* Medicare beneficiaries who reach the doughnut hole will receive a 50% discount on brand name drugs
* A 10% Medicare bonus will be provided to primary care physicians and general surgeons practicing in underserved areas, such as inner cities and rural communities.
* Medicare Advantage plans would begin to have their payments frozen.
Other:
* Employers are required to report the value of health care benefits on employees' W2 tax statements.
* Annual industry fee for pharmaceutical manufacturers of brand name drugs.
* Voluntary long term care insurance program would be made available to provide cash benefit for assisting disabled individuals to stay in their homes or cover nursing home costs. Benefits would start five years after people begin paying a fee for coverage.
* Funding for community health centers would be increased to provide care for many low income and uninsured people.
2012
* Hospitals, physicians, and payers would be encouraged to band together in "accountable care organizations."
* Hospitals with high rates of preventable readmissions would face reduced Medicare payments.
2013
* Individuals making $200,000 a year or couples making $250,000 would have a higher Medicare payroll tax of 2.35% on earned income —up from the current 1.45%. A new tax of 3.8% on unearned income, such as dividends and interest, is also added.
* Medical expense contributions to flexible spending accounts (FSAs) limited to $2,500 a year—indexed for inflation. In addition, the thresholds for claiming itemized tax deduction for medical expenses rise from 7.5% to 10% of income.
* Medical device manufacturers would have a 2.9% sales tax on medical devices; devices such as eyeglasses, contact lenses, and hearing aids would be exempt.
* Eliminates deduction for expenses allocable to Medicare Part D subsidy for employers who maintain prescription drug plans for their Medicare Part D eligible retirees.
2014
Coverage Mandates & Subsidies:
* Individual and employer coverage responsibilities are effective.
* Individual affordability tax credits are created and small business tax credits are expanded.
Health Insurance Exchange & Insurance Reforms:
* State individual and small group health insurance exchanges operational.
* Guaranteed issue, guaranteed renewability, modified community rating and minimum benefit standards (“essential benefits” plan) effective.
* Lifetime and annual dollar limits are prohibited for essential benefits.
* Pre-existing condition exclusions are prohibited.
Taxes & Fees:
* Addition of new taxes on health insurers
Medicaid and Medicare Reform:
* Medicaid expanded to cover low income individuals under age 65 up to 133% of the federal poverty level—about $28,300 for a family of four.
* Minimum medical loss ratio of 85% required for Medicare Advantage plans
2018
Taxes & Fees:
* Tax (“Cadillac tax”) imposed on employer sponsored health insurance plans that offer policies with generous levels of coverage.
2020
Medicare Reform:
* Doughnut hole coverage gap in Medicare prescription benefit is fully phased out. Seniors continue to pay the standard 25% of their drug costs until they reach the threshold for Medicare catastrophic coverage.
If you're confused by this, have questions, or would like to know more about how you or your business will be impacted by all this, just give a "shout-out" to AC Forrest Insurance Group!
Monday, March 29, 2010
Kick your Copay habit, and other ways to save on health insurance
(Note: This post was originally published on the Thriveal blog).
Look, let’s get this out of the way now. Health insurance does not provide the most gripping reading material, but it is one of those things that you have to deal with. Whatever your take on the ongoing debate in Washington, we have to work within the system we have now, and the problem with that system is that it is REALLY expensive. With rising costs and a down economy, most small business owners are looking for ways to take care of their team without killing their budget. Maybe you’re one of them. Let me offer a few suggestions. Not all of these will work in every situation, but perhaps a couple of them will help you.
1. Raise your deductible. More than two out of three people don’t hit $1,000 per year towards their deductible. In other words, most people are over-insured. Of course, one out of one people will at some point reach their deductible because, well, stuff happens. That’s why you need good major medical coverage. But why not raise your deductible, lower the premium, and put some of the savings aside for the year your number comes up? That leads us very nicely to my second suggestion…
2. Consider a Health Savings Account (HSA). An HSA allows you to save money with a triple tax advantage: the money is tax free going in, grows tax free, and is tax free as long as you use it for qualified medical expenses (and the IRS has a pretty broad definition of medical expenses). So the HSA will take your healthcare dollars farther. Because I'm not a CPA, I’ll not counsel you further on the tax benefits of an HSA. But do note – in order to open an HSA you must first have a qualified high deductible health insurance plan. The idea here is simple, you get major medical (catastrophic) coverage above the deductible, and you pay for everything before the deductible (though you benefit from provider discounts). You get a lower premium, and put the savings into your HSA to pay your portion. There’s much more that can be said about the HSA approach – but we'll leave it here for now.
3. Kick your Copay Habit. This solution could really be categorized as 2a as copay addiction is the single biggest reason given for not taking an HSA-qualified health plan. Do you have health insurance or health-care financing? Health insurance exists to protect you from catastrophic medical expenses (like a $25k appendectomy or $150k bypass – real numbers). But the average health insurance plan includes a bunch of front-end goodies (like the office visit copay) that consumers have come to expect. But often you wind up paying a significantly higher premium for the ability to save $50 (give or take) the couple times a year you go to the doctor. Let me put it this way: Does your auto insurance pay for oil changes and new tires? Then why do we expect our health insurance to pay for routine maintenance? Kick your copay to the curb and put some of your premium savings aside to pay for the doc.
4. Consider Individual Health Insurance. Most people assume they need to get on a group plan to get a better deal. In most cases, quite the opposite is true. Because there are fewer mandates and, yes, more underwriting, individual policies are almost always less expensive. They also remove the one-size-fits-all nature of a group policy, allowing each person to choose the coverage they want. The individual policy is also portable – a big plus in uncertain times. The underwriting issues are the key, though, and the result is that this option might not work for some people. But if it works, you could save a lot of money.
Like most things, the health insurance solution that fits you best is determined by your specific needs, situation, and budget. It’s not thrilling stuff, but it might be worth your time to kick it around. We'd love to help you do that - just contact us for a free insurance consultation where we'll take a look at your current plan and offer some suggestions on how you can save money.
Look, let’s get this out of the way now. Health insurance does not provide the most gripping reading material, but it is one of those things that you have to deal with. Whatever your take on the ongoing debate in Washington, we have to work within the system we have now, and the problem with that system is that it is REALLY expensive. With rising costs and a down economy, most small business owners are looking for ways to take care of their team without killing their budget. Maybe you’re one of them. Let me offer a few suggestions. Not all of these will work in every situation, but perhaps a couple of them will help you.
1. Raise your deductible. More than two out of three people don’t hit $1,000 per year towards their deductible. In other words, most people are over-insured. Of course, one out of one people will at some point reach their deductible because, well, stuff happens. That’s why you need good major medical coverage. But why not raise your deductible, lower the premium, and put some of the savings aside for the year your number comes up? That leads us very nicely to my second suggestion…
2. Consider a Health Savings Account (HSA). An HSA allows you to save money with a triple tax advantage: the money is tax free going in, grows tax free, and is tax free as long as you use it for qualified medical expenses (and the IRS has a pretty broad definition of medical expenses). So the HSA will take your healthcare dollars farther. Because I'm not a CPA, I’ll not counsel you further on the tax benefits of an HSA. But do note – in order to open an HSA you must first have a qualified high deductible health insurance plan. The idea here is simple, you get major medical (catastrophic) coverage above the deductible, and you pay for everything before the deductible (though you benefit from provider discounts). You get a lower premium, and put the savings into your HSA to pay your portion. There’s much more that can be said about the HSA approach – but we'll leave it here for now.
3. Kick your Copay Habit. This solution could really be categorized as 2a as copay addiction is the single biggest reason given for not taking an HSA-qualified health plan. Do you have health insurance or health-care financing? Health insurance exists to protect you from catastrophic medical expenses (like a $25k appendectomy or $150k bypass – real numbers). But the average health insurance plan includes a bunch of front-end goodies (like the office visit copay) that consumers have come to expect. But often you wind up paying a significantly higher premium for the ability to save $50 (give or take) the couple times a year you go to the doctor. Let me put it this way: Does your auto insurance pay for oil changes and new tires? Then why do we expect our health insurance to pay for routine maintenance? Kick your copay to the curb and put some of your premium savings aside to pay for the doc.
4. Consider Individual Health Insurance. Most people assume they need to get on a group plan to get a better deal. In most cases, quite the opposite is true. Because there are fewer mandates and, yes, more underwriting, individual policies are almost always less expensive. They also remove the one-size-fits-all nature of a group policy, allowing each person to choose the coverage they want. The individual policy is also portable – a big plus in uncertain times. The underwriting issues are the key, though, and the result is that this option might not work for some people. But if it works, you could save a lot of money.
Like most things, the health insurance solution that fits you best is determined by your specific needs, situation, and budget. It’s not thrilling stuff, but it might be worth your time to kick it around. We'd love to help you do that - just contact us for a free insurance consultation where we'll take a look at your current plan and offer some suggestions on how you can save money.
Thursday, March 25, 2010
Three Cheers for Individual Health Insurance
Here's an excellent article that dispels some myths surrounding the individual health insurance market. Recommended reading.
Tuesday, March 23, 2010
How does the health insurance bill affect my health insurance? Some advice.
How does the health insurance reform bill affect your health insurance? The situation still seems pretty fluid, but here's what seems to be the case. In the short term, nothing will really happen. The majority of the bill's provisions won't hit until 2014, including the mandate to purchase coverage and the removal of pre-existing limitation exclusions on adults.
The upshot to all of that means you'll still need health insurance to protect you from major medical events and claims that could arise over the next 3-4 years. Don't let the hype surrounding this bill blind you to the need to maintain health insurance coverage for the near future.
The most tangible negative effect of this legislation is that health insurance premiums will almost certainly begin to skyrocket very soon because all of the taxes, surcharges, and burdens placed on the carriers will go into effect very soon.
When we put these two facts together we arrive at a few pieces of advice:
* Lock in your premium as long as possible. If you're buying individual health insurance, it may be worth it to consider carriers that offer a 2 year rate guarantee (or even a 3 year rate guarantee where available). In the past we haven't typically recommended doing so, but because premiums are sure to head north in a hurry, it is wise to consider paying a little extra to lock your initial premium for that second year.
* Take a higher deductible and supplement it. When renewals come with potentially crazy increases, you'll want to bump up to higher deductibles. You'll save a lot of money by taking a very high deductible health plan and supplementing the high deductible with a good accident supplement and critical illness plan.
* Max out your HSA. If you have a qualified high deductible plan, try to max out your health savings account to pay for health-related expenses in the future. That will help prepare you should you need to head to an even higher deductible in the next couple years.
Now more than ever you need a knowledgeable guide to help you navigate these murky waters. AC Forrest remains committed to serving you. Contact us today.
The upshot to all of that means you'll still need health insurance to protect you from major medical events and claims that could arise over the next 3-4 years. Don't let the hype surrounding this bill blind you to the need to maintain health insurance coverage for the near future.
The most tangible negative effect of this legislation is that health insurance premiums will almost certainly begin to skyrocket very soon because all of the taxes, surcharges, and burdens placed on the carriers will go into effect very soon.
When we put these two facts together we arrive at a few pieces of advice:
* Lock in your premium as long as possible. If you're buying individual health insurance, it may be worth it to consider carriers that offer a 2 year rate guarantee (or even a 3 year rate guarantee where available). In the past we haven't typically recommended doing so, but because premiums are sure to head north in a hurry, it is wise to consider paying a little extra to lock your initial premium for that second year.
* Take a higher deductible and supplement it. When renewals come with potentially crazy increases, you'll want to bump up to higher deductibles. You'll save a lot of money by taking a very high deductible health plan and supplementing the high deductible with a good accident supplement and critical illness plan.
* Max out your HSA. If you have a qualified high deductible plan, try to max out your health savings account to pay for health-related expenses in the future. That will help prepare you should you need to head to an even higher deductible in the next couple years.
Now more than ever you need a knowledgeable guide to help you navigate these murky waters. AC Forrest remains committed to serving you. Contact us today.
Friday, March 19, 2010
Should I take COBRA when it's offered to me?
When should you continue your group health plan benefits under COBRA?
Many people don't realize that personal, individual health insurance coverage is often significantly less expensive that COBRA coverage or even group coverage at work (savings of 40-50% are common). However, there are times and situations when taking COBRA may be the best option:
You should continue your health benefits under COBRA if you...
* have had comprehensive benefits and don't mind paying more for them.
* want continual, guaranteed coverage at a higher cost.
* have had recent health problems.
* have had ongoing health problems.
* are taking expensive medications.
* have been declined for private insurance recently.
* have a history of medical problems.
* are pregnant or planning to get that way.
* got a job and your new employer does not offer a health plan.
Also remember, you may elect coverage on yourself or any other family member now on the group coverage, and may do so "individually." That is, maybe you're in good health, but have a spouse with a health "issue." You could elect COBRA on your spouse, but save money by purchasing individual health insurance on yourself.
The point? Don't just automatically take the COBRA offer of coverage. Talk with a broker (like us) who specializes in health insurance and see what money-saving options are available.
As ever, please contact us with questions or to talk about your specific situation and needs. For a quick quote on available health insurance options, click here.
Many people don't realize that personal, individual health insurance coverage is often significantly less expensive that COBRA coverage or even group coverage at work (savings of 40-50% are common). However, there are times and situations when taking COBRA may be the best option:
You should continue your health benefits under COBRA if you...
* have had comprehensive benefits and don't mind paying more for them.
* want continual, guaranteed coverage at a higher cost.
* have had recent health problems.
* have had ongoing health problems.
* are taking expensive medications.
* have been declined for private insurance recently.
* have a history of medical problems.
* are pregnant or planning to get that way.
* got a job and your new employer does not offer a health plan.
Also remember, you may elect coverage on yourself or any other family member now on the group coverage, and may do so "individually." That is, maybe you're in good health, but have a spouse with a health "issue." You could elect COBRA on your spouse, but save money by purchasing individual health insurance on yourself.
The point? Don't just automatically take the COBRA offer of coverage. Talk with a broker (like us) who specializes in health insurance and see what money-saving options are available.
As ever, please contact us with questions or to talk about your specific situation and needs. For a quick quote on available health insurance options, click here.
Wednesday, March 17, 2010
Helpful HSA Resources
Here are some links to some helpful HSA (health savings account) resources:
First, here is a helpful list of what items qualify as health-related expenses in the eyes of the IRS. These are things you can utilize money in your HSA to purchase without losing your tax advantage or paying a penalty. Note, many of these things would not be covered by your high-deductible health insurance policy (such as acupuncture or chiropractic), meaning they would not count towards your deductible. The tax-advantaged HSA can take your dollars further for these purchases, however, providing yet another advantage of a health savings account.
Here is an interesting chart examining how an HSA can influence one's income/cash flow on a $40,000 salary.
If you have questions about HSAs or HSA-qualified health insurance plans, or would like a quick no-obligation quote, contact AC Forrest.
First, here is a helpful list of what items qualify as health-related expenses in the eyes of the IRS. These are things you can utilize money in your HSA to purchase without losing your tax advantage or paying a penalty. Note, many of these things would not be covered by your high-deductible health insurance policy (such as acupuncture or chiropractic), meaning they would not count towards your deductible. The tax-advantaged HSA can take your dollars further for these purchases, however, providing yet another advantage of a health savings account.
Here is an interesting chart examining how an HSA can influence one's income/cash flow on a $40,000 salary.
If you have questions about HSAs or HSA-qualified health insurance plans, or would like a quick no-obligation quote, contact AC Forrest.
Tuesday, March 16, 2010
The Advantages of an Individual Health Insurance Policy
In most cases, I believe you are probably better off with an individual health insurance policy than by getting health insurance benefits through your employer. Most people are surprised by this and have never even thought about this alternative. Here are some reasons you ought to think about it:
1. Individual health insurance is usually cheaper. Most people assume the opposite is true, but they are generally incorrect. Because individual health insurance is underwritten (meaning the insurance company can deny applications or might exclude certain health conditions) and group policies are guarantee-issue, these policies are cheaper. Also, if you're healthy, there's a good chance you are paying a higher premium than you otherwise would because you are subsidizing those on the plan who are not healthy. The bottom line is this: If you're healthy, you will almost certainly get a lower premium with individual health insurance.
The obvious exception here, of course, is if your employer is paying for your coverage. They're probably paying 50% or so, but in that scenario my experience would say you ought to at least compare the prices because you may yet come out ahead. And you should definitely think about putting your dependents on an individual policy (most small employers don't pay premiums for dependent coverage).
2. Individual health insurance policies are customizable. With employer-sponsored health insurance, the employer will decide on the plan for you, or perhaps give you the option of two plans to choose from. This one-size-fits-all approach is far from ideal. When you buy your own policy, you get to pick which company to work with, what type of plan to select, what kind of premium you want to fit into your budget, and other details. There are hundreds of options, so you can work with a broker to find the one that best fits your family's needs, budget, and preferences.
3. Individual health insurance policies are portable. Don't miss this distinctive because it is often overlooked. You own your individual health insurance policy - it is not tied to your job. If you lose your job or choose to go in a different direction, you will lose your employer-sponsored health insurance plan or pay elevated COBRA premiums for up to 18 months (and then it's gone forever). That might not seem like a big deal now, but what if your health (or that of a dependent) changed dramatically between now and then? If something terrible happened, you could find yourself without health insurance when you need it most. But if you own your health insurance policy, it stays with you when you leave your employer for whatever reason.
Individual health insurance isn't right for everyone, but if you haven't thought about it, you owe it to yourself to at least consider it. If you'd like to take a look at your individual health insurance options, check out our online "quote engine" to run instant, no-obligation quotes or contact AC Forrest.
1. Individual health insurance is usually cheaper. Most people assume the opposite is true, but they are generally incorrect. Because individual health insurance is underwritten (meaning the insurance company can deny applications or might exclude certain health conditions) and group policies are guarantee-issue, these policies are cheaper. Also, if you're healthy, there's a good chance you are paying a higher premium than you otherwise would because you are subsidizing those on the plan who are not healthy. The bottom line is this: If you're healthy, you will almost certainly get a lower premium with individual health insurance.
The obvious exception here, of course, is if your employer is paying for your coverage. They're probably paying 50% or so, but in that scenario my experience would say you ought to at least compare the prices because you may yet come out ahead. And you should definitely think about putting your dependents on an individual policy (most small employers don't pay premiums for dependent coverage).
2. Individual health insurance policies are customizable. With employer-sponsored health insurance, the employer will decide on the plan for you, or perhaps give you the option of two plans to choose from. This one-size-fits-all approach is far from ideal. When you buy your own policy, you get to pick which company to work with, what type of plan to select, what kind of premium you want to fit into your budget, and other details. There are hundreds of options, so you can work with a broker to find the one that best fits your family's needs, budget, and preferences.
3. Individual health insurance policies are portable. Don't miss this distinctive because it is often overlooked. You own your individual health insurance policy - it is not tied to your job. If you lose your job or choose to go in a different direction, you will lose your employer-sponsored health insurance plan or pay elevated COBRA premiums for up to 18 months (and then it's gone forever). That might not seem like a big deal now, but what if your health (or that of a dependent) changed dramatically between now and then? If something terrible happened, you could find yourself without health insurance when you need it most. But if you own your health insurance policy, it stays with you when you leave your employer for whatever reason.
Individual health insurance isn't right for everyone, but if you haven't thought about it, you owe it to yourself to at least consider it. If you'd like to take a look at your individual health insurance options, check out our online "quote engine" to run instant, no-obligation quotes or contact AC Forrest.
Monday, March 15, 2010
Why is health insurance tied to your job?
Individual health insurance is better and preferable to employer-sponsored health insurance. Yep - and tomorrow I'll tell you why. So why do most Americans have health insurance through their employers?
The fact that most people get their health insurance coverage through their job is an accident of history, the result of government-enacted wage freezes during World War 2. (To reward employees, companies got creative and started funding their healthcare since they couldn't increase their pay directly). Think about it - would you ever ask your employer to take care of your homeowner's policy or auto insurance? But health insurance (and, to a lesser extent, disability insurance) is different - people expect to get that at work.
There are people out there that believe the only way to get a good health insurance plan is to get one through your employer. And to be fair, for some people that's true - specifically, those who have medical conditions or medical histories that would disqualify them from getting an individual health insurance policy. Group health insurance is "guarantee-issue," meaning that you cannot be denied coverage for any reason if you qualify for an employer's plan.
So group health insurance is the only option for some people. But for others, there is a better way, which we'll discuss next time.
The fact that most people get their health insurance coverage through their job is an accident of history, the result of government-enacted wage freezes during World War 2. (To reward employees, companies got creative and started funding their healthcare since they couldn't increase their pay directly). Think about it - would you ever ask your employer to take care of your homeowner's policy or auto insurance? But health insurance (and, to a lesser extent, disability insurance) is different - people expect to get that at work.
There are people out there that believe the only way to get a good health insurance plan is to get one through your employer. And to be fair, for some people that's true - specifically, those who have medical conditions or medical histories that would disqualify them from getting an individual health insurance policy. Group health insurance is "guarantee-issue," meaning that you cannot be denied coverage for any reason if you qualify for an employer's plan.
So group health insurance is the only option for some people. But for others, there is a better way, which we'll discuss next time.
Wednesday, March 10, 2010
Some Distinctives of Carolina Care Plan
Carolina Care Plan is one of our preferred carriers in South Carolina, particularly in the group benefits market. Here are some of their distinctive advantages:
* Expansive office visit co-pay
* 5 million lifetime maximum
* No dollar caps on organ transplants
* No dollar caps on preventive services
* 100-percent preferred lab benefit
* No age restriction on immunizations
* 100-percent benefit for physician maternity charges
* Coverage for routine eye care
* Expansive office visit co-pay
* 5 million lifetime maximum
* No dollar caps on organ transplants
* No dollar caps on preventive services
* 100-percent preferred lab benefit
* No age restriction on immunizations
* 100-percent benefit for physician maternity charges
* Coverage for routine eye care
Wednesday, March 3, 2010
What People Are Saying About AC Forrest Insurance
In general we don't like to boast, but when you're considering hiring someone or trusting them with your business, it's a good idea to see what others have said. Because we want to earn YOUR business, we offer some customer feedback:
These folks represent a cross section of clients, including employer/group health insurance clients, individual health clients, and term life insurance clients. We'd love the opportunity to serve you.
“Wow!! it was hard to only choose 3 attributes that describe Alex. He is a pleasure to work with. He has been there to service our small account when we needed him. He is always courtesy and punctual. Always returns call and emails timely. I would highly recommend your talking with Alex for all your insurance needs. He can help you find the policy that best suits your needs with no other motive but to provide you with good service and coverage. Thanks for taking the time to read my recommendation and I know you will not be disappointed if you call him." - a small law office
“Alex walked me through the process to make the best decision for life insurance for my family. It is great to be able to have the confidence that our final decision provides for my family. I would recommend Alex to walk anyone through this process.” - J.H.
“I have been very impressed with Alex. I hired him last year as our health insurance agent. He has found ways to save two of my employees money. He is very responsive with small questions and eager to help. I've been in business 10 years and Alex is the best health insurance agent I've worked with.” - Nathan
“Alex helped out family choose a health insurance package. He was very knowledgeable about the different providers and was able to recommend the best plan for us. It was a pleasure to work with him and we will certainly use him for our future insurance needs.” - a web developer
“I recently became self employed and came to Alex Forrest for a health insurance plan for my family and me. Alex was knowledgeable and worked diligently to find and recommend a plan that met my family's needs and budget. He was pleasant to work with and kept me well informed of the status of our application. We were approved and had insurance cards in our hands quicker than I ever expected. Because of this positive experience, I would highly recommend Alex Forest to colleagues, friends and family." - D.P.
“If you need to talk to someone about health insurance, get in touch with Alex Forrest. He’s great at what he does and really cares about people.” - R.T.
"Thanks for being so responsive. You stood by us and were an excellent representative. We would be glad to recommend you without reservation." - Ed
"My wife and I searched several websites trying to sort out the often confusing and complex information on private health insurance coverage.
After responding to one website search, we were bombarded with contacts on the web and over the phone from several brokers and sales agents. Alex was the only one who we were confident was working on our behalf." - David
“I am so glad I have good insurance. I was diagnosed with lymphoma in January....quite a journey! Its a treatable form of cancer but I had to go through chemo. I got a clean bill of health this week from my doctor but it has been a long 6 months! Thank you for all your time, attention, and help!” D.G.
These folks represent a cross section of clients, including employer/group health insurance clients, individual health clients, and term life insurance clients. We'd love the opportunity to serve you.
Monday, March 1, 2010
How does my deductible work?
Question: I'm a bit confused about the deductible. How does that work in relation to smaller expenses?
Answer: The deductible represents your costs before your health insurance coverage kicks in. Many people lose sight of the main purpose of health insurance, which is to protect you from catastrophic financial loss (like the $25,000 appendectomy or the $150,000 heart bypass - real numbers) that could crush you. As with any form of insurance, you're transferring risk. The more risk you transfer (which takes the form of lower deductibles and other benefits) the more you pay. The more risk you take for yourself (higher deductibles or whatnot), the lower your premium.
So with any covered expense, you pay the deductible amount every year unless otherwise stated. Some plans include what they call "first dollar benefits" - these are benefits that are paid for you before the deductible. A doctor copay, drug card, preventive care benefits, etc. are first dollar benefits. These first dollar benefits don't apply to your deductible. But when you get a smaller bill, say $500, for a covered expense (let's say for an MRI), what you pay counts towards your annual deductible.
Obviously, if you have a high deductible plan, you will pay more should a major event occur. But because you're bearing more risk, you'll realize significant savings on your monthly premium. Contact us to learn more or to get a no-obligation quote on health insurance for your family or business.
Answer: The deductible represents your costs before your health insurance coverage kicks in. Many people lose sight of the main purpose of health insurance, which is to protect you from catastrophic financial loss (like the $25,000 appendectomy or the $150,000 heart bypass - real numbers) that could crush you. As with any form of insurance, you're transferring risk. The more risk you transfer (which takes the form of lower deductibles and other benefits) the more you pay. The more risk you take for yourself (higher deductibles or whatnot), the lower your premium.
So with any covered expense, you pay the deductible amount every year unless otherwise stated. Some plans include what they call "first dollar benefits" - these are benefits that are paid for you before the deductible. A doctor copay, drug card, preventive care benefits, etc. are first dollar benefits. These first dollar benefits don't apply to your deductible. But when you get a smaller bill, say $500, for a covered expense (let's say for an MRI), what you pay counts towards your annual deductible.
Obviously, if you have a high deductible plan, you will pay more should a major event occur. But because you're bearing more risk, you'll realize significant savings on your monthly premium. Contact us to learn more or to get a no-obligation quote on health insurance for your family or business.
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