Individual Health Insurance

Is Being Uninsured Worth the Risk?

A friend of mine, "Mike," is about to change jobs. He has a waiting period of three months before coverage under his new employer's plan begins. That means he has a three-month period in which he'll either pay to extend his benefits under COBRA, buy individual health coverage, or go uninsured.

At first, Mike was inclined to go uninsured, save the money, and "hope and pray" no big medical expenses arise. He doesn't plan on going to the doctor during his hiatus from coverage, and his wife is covered through her job and they have no other dependents to worry about.

He knows I work in the health insurance industry so he asked me for my opinion: "Do I really need insurance before my new group coverage begins? Can't I pay out-of-pocket for any medical expenses that come up?"

"Not so fast!" I warned. Being uninsured can cost a lot more than paying health insurance premiums. Mike may be able to pay for a doctor's visit or prescription out of his savings, but what if he's in a serious accident or develops a serious illness? Without major medical coverage he'd be responsible for paying all of these unexpected - and costly - medical bills on his own.

Mike decided it's not worth the risk. He doesn't want to become a cautionary tale. He's purchasing a short-term individual health plan to fill the gap. It's less expensive than COBRA, and far less expensive than taking on the risk of huge, unexpected medial bills he's not planning for.

If you, like Mike, find yourself between jobs, ask yourself if being uninsured before your new group plan takes effect is a risk you're willing to take. Individual health coverage can provide peace of mind during this time.

Visit Celtic's Individual Health Insurance Learning Resources page to learn more about how individual health insurance can meet your coverage needs.

Health Insurance for Unemployed Individuals

If you're unemployed, health insurance becomes an important matter. If you had a group plan at your old job, you may first consider COBRA coverage, which guarantees health benefits for people who've lost their jobs.

But COBRA rates are expensive because you are now responsible for paying the full amount for your healthcare coverage. Whereas when you were employed, your employer paid a significant portion of the cost of your group plan and you paid a much smaller amount.

So if COBRA is too expensive, there are alternatives. Over the next few blogs we'll take a look at some different individual health plan solutions.

Short-Term insurance is a great product to consider first. It's inexpensive and helps fill a temporary need. You can pay on a month to month basis for your coverage and often qualifying for coverage is a little easier. Since unlike COBRA, with individual health plans you have to qualify/be underwritten to be accepted for a plan.

Short-Term plans often have several different deductibles to choose from. If you take a higher deductible, it will really keep your monthly rate down, while keeping you protected from an unforeseen accident or illness. For healthy people on a tight budget, Short-Term health insurance is ideal. 

You can get coverage starting tomorrow, by learning more today.

Finding the Right Individual Health Plan, Part 1: Assessing Your Benefit Needs

If you're considering individual health insurance coverage, you have to do some comparison shopping to find a plan with the right benefits and price to fit your needs. You'll find there are many plans available to choose from: lower-cost basic benefit plans, more comprehensive benefit-rich plans, HSA-compatible plans and short-term temporary plans. How do you know what's right for you?

This is the first of three blog posts focusing on helping you assess your needs so you can make a sound decision. First, you'll want to answer the question "What health benefits will I use?" so you'll have an idea of how much coverage you need in a plan.

It helps to break the question down into smaller parts:

• Do I need to utilize PPO network doctors and hospitals?
• How often do I or other covered individuals visit a primary doctor? Specialists?
• Do I need coverage for prescription drugs?
• Do I want supplemental accident coverage?
• Do I want other optional benefits?
• Do I need coverage primarily for the "big ticket items" like accidents and illnesses?

Compare your plan alternatives side-by-side to see which plans offer the level of coverage you're looking for. You'll see that some plans offer very basic coverage while others provide a wider range of benefits and more flexibility with plan choices and benefit options. You may like the benefits on one plan more than another's, but you may find its price to be outside of your comfort zone. That's why the next step is to think about how each benefit affects the plans' cost.

In my next post, I'll give some tips to help you find a plan with the right coverage and price. There are some tricks to getting the benefits you need while staying within your budget. Prepare yourself to answer this question:

"How much can I afford to spend?"

In the meantime, visit Celtic's Consumer Learning Center to learn more.

New 2010 HSA Contribution Guidelines

Here's another great fact about HSA programs - you can make your annual contribution into the account at any time throughout the year.  Many people contribute on a monthly basis to make it easy for budgeting purposes. However, if you just enrolled in November in a high deductible health plan you can still make the entire year's worth of contributions into your account and enjoy all the tax advantages that go along with having an HSA. (You must have coverage in place by Dec. 1 and remain covered through the following year.)

2010 provides individuals and families even greater opportunities to save for current and future health care expenses with new contribution amounts, deductibles and out-of-pocket maximums. In 2010:

• Individuals with an HSA program can contribute $3,050 and families can contribute $6,150 into their accounts. HSA holders age 55 and older can contribute an extra $1,000 for the year. 
• The minimum annual deductibles are $1,200 for individuals and $2,400 for families.
• The annual out-of-pocket maximums (including copays, deductibles and other amounts, but not premium) are $5,950 for individuals and $11,900 for families.

Remember, all the money you contribute into your HSA is tax deductible from your gross income and grows tax deferred. For more information on HSAs, visit the Celtic HSA Resource Center.

 

Open-Enrollment: A Good Time to Consider Individual Health

Economic times are tough, so lots of people are looking for ways to save money on their health insurance. Many companies need to save money, too, and they're shifting more of the costs of health insurance to employees. This may make group coverage more expensive for those who get coverage through their work.

Open enrollment, which is taking place now in most companies, is the perfect time to compare your group coverage with what's available to you in an individual health plan. Start by looking at the costs, benefits and eligibility requirements of your employer's 2010 group plan.

• Does your group health plan require your pay higher copays or higher deductibles in 2010?

• Is the amount you're paying for health insurance going up?

• Do you have the opportunity to enroll your spouse and children under your plan?

If you don't have access to affordable, adequate group health coverage, consider quoting individual health insurance. An individual health plan may offer you lower monthly premiums, more deductible choices, and options to cover spouses and children.

To find out if an individual health insurance plan might be the solution to the affordable coverage you need, explore the many resources at www.celtic-net.com and get a quote today!

Another Year of Growth for HSA Programs

In today's economy, health care affordability is on everyone's mind. That's why Health Savings Account (HSA) programs are a really smart and important consumer directed health care product. Combining a qualified high deductible health plan (HDHP) and a health savings account, HSA Programs offer you major medical coverage along with tax savings and more control over your health care expenses.

It seems their popularity is growing. According to the America's Health Insurance Plans (AHIP) annual census of its U.S. health insurance carrier members, 8 million people were covered by HSA-qualified HDHPs in January 2009, up from 6.1 million in January 2008.

And if you are considering purchasing individual health insurance, you'll see yourself in the statistics below:

• Enrollment rose to 1.8 million covered lives in January 2009, up from 1.5 million in January 2008
• Almost 92% of enrollees in HSA-qualified HDHPs were in PPO (preferred provider organization) products
• Based on the number of covered lives, 54% were male and 46% were female
• Of those covered under an HSA-qualified HDHP plan, 53% were aged 40 and above and 47% were below the age of 40

The statistics show that this plan is becoming more widely purchased by individuals and employees. The statistics help us understand that women, who traditionally use more preventive services, are finding the value in HSAs and making them fit their lifestyles. In fact, people of all ages are finding that this type of health plan can work for them. Your HSA bank can help with the math when purchasing a plan, and you can watch the savings really add up.

Source: AHIP January 2009 census released in May of 2009.

 

 

Individual Health Insurance Basics, Part 2

My last post went over some basic information about individual health insurance. This time I'd like to dig deeper into how plans are priced.

How much does an individual health insurance plan cost?
Cost is an important consideration when buying health insurance. Running quotes is the fastest way to find out what a policy might cost you. Generally speaking, a plan with more coverage will cost more than a plan with less coverage. You may find the benefits in an individual policy are simpler than in a group plan. And, there is usually a greater cost-sharing element. For example, you might have to pay co-payments, deductibles and coinsurance before the insurance plan pays any claims. But the more cost-sharing you are willing to take on, the less you pay for the insurance premiums.

Most people just want the peace of mind that they have coverage should they be diagnosed with a serious illness or have a bad accident. Many do not want or need an all-inclusive or very comprehensive plan because these tend to be more expensive. That's why a basic benefit plan works for many people.

Here are a few insurance definitions you might find useful:

Annual Plan Deductible: The dollar amount that the insured must pay out-of-pocket each year before the insurance company will make any benefit payments for claims.

Coinsurance: The percentage an insured is required to pay for a medical claim, after the co-payment or deductible. For example, if you choose an 80/20 plan, you pay 20% of the eligible covered amount and the insurance company pays the other 80%.

Copayment: The amount specified in your plan that an insured person pays to a provider for a specific health care service at the time it is received. For example, an insured may pay a "$35 office visit copay".

Out-of-pocket maximum: The maximum amount that an insured is required to pay under an insurance policy per year.

Visit Celtic's Individual Health Insurance Learning Resources page to learn more.

Will we still be covered?

The kids are grown and you and your spouse are finally getting the “just 15 minutes of quiet” you’ve been asking for all those years. Now what? It may be that dream you had of starting your own small business together. It’s probably safe to say your soon-to-be old employer isn’t going to let you stay on their group plan. Not a problem. There are many plans available in the individual health insurance market that may meet your needs.

You no longer need comprehensive coverage for your children but you may still want it for yourself and your spouse. Many plans have coverage that includes preventive annual screenings, well visits and prescription drugs. Many plans also include money-saving benefits like non-tobacco rates and/or preferred rates. A healthy lifestyle program may also be a plan feature that provides additional savings, such as cash back on annual gym memberships and fitness classes.

Another type of coverage that may fulfill your needs is a HSA program, which combines a qualified high-deductible insurance plan with a health savings account component. Created under federal legislation, HSAs offer a way to purchase a health insurance policy and save money tax-free. Contributions to your HSA account are tax deductible up to the lesser of 100% of your deductible or to the IRS allowed maximums. The withdrawals from your HSA account are tax-free when used to pay for qualified medical expenses. Your HSA money earns interest tax deferred and rolls over year after year. What you don’t spend on health care continues to grow as tax deferred savings until you reach age 65 at which point you can use the savings tax-free for medical expenses not covered by Medicare or for non-qualified expenses and only receive normal taxation.

With all the options available in today’s consumer market, you can venture ahead with your dreams of your own business without the worry of “will we still be covered?”

When Basic is Better

I recently planned a vacation - a glorious road trip spanning northern California's wine country, San Francisco, Big Sur and Los Angeles. Most of my online "legwork" was spent researching and comparing prices for rental cars. I had to pay attention to drop-off fees and parking charges, not to mention the considerable number of miles we were putting on the car. The range of car types and price points were astounding!

As much as I wanted to rent a luxurious trail-ready SUV or a fun, sporty convertible, we really couldn't afford it. And did we need heated seats, a sunroof, or room for seven people? We certainly didn't want to pay for these extra features we really weren't going to use. If we had kids in tow or truly needed the amenities and conveniences of a more expensive rental, I'm sure we could have shuffled our budget around to accommodate it. So we made our way with a sensible car that got us from point A to point B to point C - and had a rate that left us some money for souvenirs!

Health insurance is similar. Many people set out, as I did with the rental car, thinking about the features of a "fully-loaded" product. But when it comes to making the purchase decision, they simply don't need the extensive benefits and higher price tags that usually come with the more comprehensive plans.

That's why basic benefit health plans are so popular - they're reasonably priced with just the right amount of major medical coverage for hospitalization, Rx drugs, PPO office visits, and even preventive care. While these plans lack many of the "bells and whistles" of more comprehensive health plans, they have the important benefits that consumers need and the prices they shop around for.

The thing to keep in mind is that basic benefit plans require policyholders to cost-share (to pay additional deductibles for hospital visits and Rx drugs, for example) in exchange for low monthly premiums and essential major medical coverage when they need it. That's kind of like paying out of pocket for gas and supplementary collision insurance on a rental car that comes standard with A/C, power windows and satellite radio, right?

I'm happy to report our road trip was a great success! We really were quite comfortable traversing the coastal highways and bustling city streets in our sensible car. (All of the natural beauty was outside the car, anyway!) Not only did we have fun, but I felt really good knowing we saved as much money as we did. If only health insurance plans came with satellite radio...

Seeing the Value of HSAs

I recently was helping a friend who was considering purchasing a HSA qualified health plan. She is going into private practice after working for a number of years at a large law firm. She knows health coverage is important, but isn't sure if a HSA makes sense.

Information about Health Savings Accounts

After helping her with a HSA quote, she found a premium savings of about $100 a month compared to a traditional major medical plan. The extra $100 she saved on premium she could use to fund her health savings account. Her tax accountant, who helped her set-up her solo practice, said that was a really smart idea because the money she invested in the HSA could be deducted from her annual income tax. Plus, the money would grow tax free.

Coming from a group plan she was also used to having dental and vision benefits. She decided not to purchase any additional coverage and simply use the money in her HSA account to pay for those qualified medical expenses when the need arises. After viewing the complete list of qualified medical expenses she realized the HSA account would pay for a lot more than just dental and vision exams.

Consumer Direct Health Care that Works

My friend feels lucky, after doing the research and having our conversation she felt comfortable with an HSA. It's helping her stay within budget as she gets her practice up and going, yet provides her with important peace of mind.  

Want to find out if a HSA is right for you? Celtic offers a quick and interesting HSA presentation.