3 posts tagged “uninsured”
I have been a multi-state licensed health and life insurance broker for over a decade and one of the biggest challenges I have had to deal with throughout the years, has been trying to help individuals that have been labeled as "uninsurable."
On the Individual Health Insurance market, insurance companies get to "pick and choose" who they offer individual health insurance coverage. This means that insurance companies tend to offer coverage to healthy individuals versus individuals with serious pre-existing medical conditions. In fact, since insurance companies are not obligated to offer anyone coverage on an individual health plan, quite often, individuals with serious pre-existing medical conations are often "declined coverage" altogether.
Once an individual is declined health insurance coverage, that "decline" ends up on their Medical Information Bureau Report (MIB), which other insurance companies have access to. This makes them very likely to be declined again in the future when they apply for health insurance coverage with a different carrier.
Quite often, individuals that have been declined coverage find themselves labeled as "uninsurable." This uninsurable status usually lasts for many years, and in some cases, may last for the rest of the individual's life.
Here is a list of just a few of the pre-existing medical conditions that likely render an applicant uninsurable for ten years or more are:
On many occasions, I also run into individuals that have "less serious" pre-existing medical conditions. Quite often, many of the carriers I represent, classify certain conditions, like Hypertension (high blood pressure) or Hyperlipidimia (high cholesterol) as "rateable conditions." Rateable Conditions are medical conditions that are normally controlled with medication. However, most insurance carriers also consider obesity and smoking as "rateable conditions."
If an individual with a "rateable condition," applies for health insurance coverage, the insurance company may offer the applicant coverage for a pre-existing conditions if the applicant coverage agrees to pay a higher monthly premium. These are premium increases are known as "Rate ups."
In general, insurance companies can "rate up" an applicant for a variety of reasons which are not necessarily limited to the applicant's pre-existing medical condition. For example, individuals who smoke or are more than 30 lbs overweight often receive a "rate-up" because their risk factors are higher.
Sometimes, insurance carriers will refuse to offer coverage to applicants that have more than two or more rateable conditions. For example, if the applicant has the two aforementioned conditions and is also over weight, the underwriting guidelines for that insurance carrier may classify the applicant as "uninsurable."
In fact, many carriers adopt a "3 strikes your out" underwriting process, which means that an applicant with three "rateable conditions," whether controlled or not, is automatically declined health insurance coverage.So, what happens if you find yourself in this category, specifically:
What do you do if you are labeled uninsurable?
For many years, depending on the state you live in, you only had two options. They were as follows:
1.) If you have a corporate tax i.d. number you can purchase a small group health insurance policy from most insurance carriers. With this scenario a minimum of two people (often husband & wife) who work for the same corporation can apply for a small group health insurance policy.After a period of time, or in some cases immediately (depending on how many months you have had prior health insurance coverage without a lapse) pre-existing conditions will be covered provided that they are a covered expense on the policy.
2.) Enroll in your states State Insurance Risk Pool (if your state is fortunate enough to have one). For example, in my home state of Illinois the risk pool is called the Illinois Comprehensive Health Insurance Plan (ICHIP). ICHIP is a state health benefits program and not an insurance company. Persons must qualify for coverage but in most cases if the applicant is coming off an exhausted qualified COBRA continuation plan from a prior employer sponsored group, their pre existing conditions will be covered from day one, provided that those conditions are a covered expense on the ICHIP policy.
ICHIP and all insurance risk pools, are by no means entitlement programs because they are not free! Premiums charged are established by law at from 125%-150% above the average rates charged individuals for comparable major medical coverage by five or more of the largest insurance companies in the individual health insurance market in that state.
These premiums are far from affordable for many people. The rates for a person 50 years of age living in Chicago can range from $554 monthly for a $5,200 deductible plan to $852 monthly for a $500 deductible plan.
For those who do not have an insurance risk pool in their state, their health insurance options are even more limited, especially if they are "uninsurable."
Fortunately, there is now another option that is available through American Medical & Life Insurance Company of New York, New York. This company is now offering a "Defined Benefit Health Insurance Policy" that will offer coverage to the "uninsurable" with only three restrictions.
They are as follows:
1.) Individuals may not be Medicare recipients.
2.) Individuals may not be receiving disability benefits.
3.) Individuals may not be receiving workers' compensation benefits.
There are no other underwriting requirements which means that regardless of someone's health history, they can obtain major medical health insurance coverage.
What exactly is covered by a Defined Benefit Health Insurance policy?
American Medical & Life Insurance Company has four different Defined Benefit Health Insurance Policies to choose from.
Below are a list of benefits on the best of the four different plan options. Remember, All benefits are provided on a "first dollar" basis, which means that you don't have to pay your deductible first to receive these benefits.
- $1,000 per day covered for the first 100 days of hospital admission
- $2,000 in additional coverage for the first day of hospital admission
- $1,000 in additional coverage for the first 15 days of Intensive Care or Critical Care
- Unlimited inpatient our outpatient Surgical Benefit provided on all plans
- One Preventative Care Visit is covered per insured per calendar year with a $150 allowance for that visit
- Up to 7 outpatient doctor office visits included with the with no co pay or deductible required
- Mail order Generic & Brand name medications are discounted at up to 50%
- Medically necessary diagnostic tests and x-rays performed in a doctor's office or outpatient facility (e.g. MRI, CAT Scan, EKG, Mammography) are covered up to $400 per visit with a 5 visit allowance per year
- There is a 12 month waiting period for Pre Existing conditions. However, because the plan is HIPAA compliant this waiting period will be waived if you have a Certificate of Creditable coverage from another health insurance plan showing 18 months of prior coverage with no lapse of more than 63 days
- $5,000 of Critical Illness coverage provided for Primary Insured & Spouse (optional on other 3 plans)
- Nationwide P.P.O. network (www.multiplan.com)
Arguably, these benefits rival the "first dollar" benefits provided on most major medical health insurance policies on the market today. And, the most attractive part about this kind of health insurance policy is that the premium required is typically well below half the premium required for ICHIP and other state insurance risk pools.
Additionally, just like the state insurance risk pool coverage, a Defined Benefit Health Insurance policy is fully HIPAA compliant. This means that if you are coming off of an employer sponsored Cobra continuation plan and can produce a certificate of "creditable coverage" from this prior carrier showing that you had 18 months of prior coverage with no lapse of more than 63 days, your pre existing conditions will be covered immediately. This means that you will not be subject to 12 month waiting period for pre-existing conditions.
While a major medical health insurance policy is always the best way to insure yourself against the catastrophic illness and endless medical bills, a Defined Benefit health insurance policy is, most certainly, a cost effective way to protect yourself if you are rendered "uninsurable" on the individual health insurance market.Without a doubt, this is the finest Defined Benefit health insurance policy on the market today. Especially since many of the offers that target the uninsurable only consist of discounts on medical services. Although clever advertising is often used, discount plans, like "Care Entree" or "Ameriplan" which promise an entire family health coverage for $89 a month DO NOT health insurance!
This "health coverage" referred only a discount and it is so inexpensive because it provides nothing more than P.P.O. repricing which is the same reduced rate insurance companies often negotiate for medical services. Although not necessarily a bad thing for someone who has NO OTHER OPTION, a discount health plan should NEVER be confuses with Health Insurance Coverage.
Without a Major Medical or Defined Benefit health insurance policy, an individual can experience catastrophic medical bills with these types of "health plans." If the average P.P.O. discount on medical procedures performed within a P.P.O. network is between 25% & 40%, a 40% discount on a $100 doctor office visit is a good deal because the visit will only cost the discount card holder $60. However, if the medical bill is $100,000 and the discount card holder has to pay 60% of the bill, the $89 a month "discount health plan" is anything but a good deal. (60% of 100K = $60,000....Yikes!)
For more information on the Guarantee Issue Defined Benefit Health Insurance Plan, other Major Medical Plans and tips on how you can tell if a discount plan is actually "health insurance," please visit our web site @ www.smallbusinessinsuranceservices.com
If you have been classified as "uninsurable" and you want to check out rates and apply online for the aforementioned Defined Benefit Health Insurance plan offered through the Association for Independent Managers (AIM) click this link: aimhealthplans.comPlans are underwritten by American Medical and Life insurance Company of New York, New York and are available in all 50 states.
If you are a business owner, self-employed or an employee of a company that is not offering medical coverage though your employer, you may have to undertake the frustrating, daunting and time consuming task of purchasing health insurance on your own. If this is the case, there are certain things that you can do become an informed consumer so you can ensure that you are purchasing the type of health insurance coverage you really need at a price you can afford.
When you purchase a health insurance plan, it is important that you balance four important variables:
wants, needs, risk and cost, before you spend your money.
Although you may "want" a health plan that offers you 100% coverage and a $5 Copay for prescription medications, you may not "need" this type of health plan if you are healthy, take no medications and do not have any significant health related "risk" factors.
Since a 100% health plan will "cost" significantly more than an 80/20 Plan, it may not be in your best interest to pay higher monthly premiums for 100% coverage if you are currently healthy.
Although no one knows exactly when they will actually use their insurance coverage, considering these four key variables prior to purchasing a health plan is a good rule of thumb.
It is also critical for health insurance consumers to understand that all plans, even 100% Plans, have some form of coverage limitations. Knowing what your policy DOES NOT cover, is more important than knowing what it DOES cover.
The following is a list of 10 key questions that should help health insurance consumers to better understand the coverage limitations of the plans they are considering purchasing. Make sure you ask your insurance agent these questions BEFORE purchasing a health insurance policy.
1. What insurance company do you represent and are you a "captive" agent, "independent" agent or an insurance "broker?" "Captive" agents represent ONE insurance company's products only.
An "independent" agent or insurance "broker," on the other hand, typically represent many quality insurance carriers and can sell a variety of different insurance products without any contractual restrictions.
BEWARE! Dealing with a "captive" agent may limit your choices, since these agents can only sell that particular insurance company's health plans.
2. What is the plan's calendar year Deductible and would I have to pay a separate deductible for each family member if everyone in my family became ill at the same time? The majority of health plans have a per person calendar year deductible, for example, $250, $500, $1,000, or $2,500. Some plans are designed so in a "worse case scenario" only two family members will have to pay their deductible in any given calendar year.
BEWARE! Some plans will require each person in the family to pay their calendar year deductible. This can be a huge financial burden if everyone in the family was involved in an accident or if members of the family became ill at the same time. Many plans have a separate drug deductible before the plan will pay for any medications. Make sure you know what deductibles you will be responsible for before you buy a health plan.
3. What is the plan's Coinsurance percentage and what Stop Loss Number is this percentage based on?
These percentages are typically based on a specific dollar amount, known as the "stop loss number." Here's where it get's tricky. Quite often, health insurance plans have different "stop loss numbers". I have seen some plans that have a "stop loss number" as low as $2,000 and as high as $25,000 or some with none at all.
Let's figure out the insured's maximum out of pocket on an 80/20 plan that has a $1,000 deductible and an 80/20 split of the first $5,000 ("stop loss number.")
$1,000 + 20% of $5,000 ($1,000) = A Maximum Out of Pocket of $2,000.
Now, let's figure out the insured's maximum out of pocket on an 80/20 plan that has a $250 deductible and a $10,000 "stop loss number."
$250 + 20% of $10,000 ($2000) = A Maximum Out of Pocket of $2,250. (Note: Total does not include any separate "service deductibles" or access fees. Many low quality plans also have these.)
Again, after this brief 80/20 cost sharing with the insurance company, also know as a the coinsurance percentage split, most major medical plans will pay 100% of in-network covered charges up to the Lifetime Maximum amount that is specified in the policy.
BEWARE! Some policies on the market are sold with NO stop loss, but still list a coinsurance percentage. Therefore if you purchase an 80/20 with no stop loss, you will actually be paying 20% of all of your medical bills each calendar year. So unless you want to be responsible for 20% of all of your bills, make sure you find out what the "stop loss number" is BEFORE you purchase a health plan!
4. What is the plan's Maximum Out Of Pocket Expenses per year? This expense is a total of all deductibles, plus all coinsurance percentages, plus all applicable "access fees", "service deductibles" or other "fees" outlined in your policy.
BEWARE! Quite often agents neglect to tell prospects about hidden fees, so make sure you have a good grasp on the basics, like deductibles, coinsurance & stop loss numbers. Always ask about additional "fees" BEFORE you purchase the plan!
5. What is the plan's Lifetime Maximum Benefit if I become seriously ill and does the plan have any "per illness" maximums or caps? The majority of health insurance plans have a two million or five million dollar Lifetime Maximum Benefit. The Lifetime Maximum Benefit is the maximum amount the insurance company will pay if you or someone in your family becomes seriously ill.
BEWARE! Some policies will stipulate that there is a maximum benefit cap of $100,000 per illness. This means that you would have to develop many separate and unrelated life-threatening illnesses costing $100,000 or less to qualify for the five million dollar Lifetime Maximum Benefit. Mega Life & Health, Midwest National Life a.k.a. Health Markets, formerly U.I.C.I., endorsed and promoted by the National Association for the Self Employed (N.A.S.E) and the Alliance for Affordable Services are known for selling "schedule" plans with "per illness caps."
6. Is the plan a Schedule Plan, in that it only pays a certain amount for a specific list of procedures? Some health plans only pay a specific dollar amount for certain procedures, despite the fact that the procedure often cost more than the plan stimulates.
BEWARE! Mega Life & Health, Midwest National Life a.k.a. Health Markets, formerly U.I.C.I., endorsed and promoted by the National Association for the Self Employed (NASE) and the Alliance for Affordable Services are known for selling "schedule" plans.
7. Does the plan have unlimited doctor copays or is there a limited number of doctor copay visits allowed each year? Many quality plans have no limit on the number of times you can use your doctor copay.
BEWARE! Several plans have a limit of how many times you can go to the doctor each year for a Copay. Quite often, the limit is 2-4 visits per year.
8. Does the plan offer Prescription Drug Coverage and if it does, what type of coverage? Some plans offer prescription drug benefits on both generic and brand name medications right away. Other plans will require you to pay a separate outpatient prescription drug deductible before you can obtain your prescription medication for a Copay.
BEWARE! Today, many plans offer NO outpatient prescription drug Copay options. Typically, these plans only provide the insured with a discount prescription card which only offers the insured a 10-20% discount on prescription medications. This can lead to catastrophic out of pocket expenses to the insured.
9. Does the plan have any reduction in benefits for Organ Transplants and if so, what is the maximum the plan will pay out for an organ transplant? The majority of quality major medical plans treat organ transplants as any other illness. This means that the insurance company will cover the insured until the Lifetime Maximum Benefit of the plan is reached. Again, in most cases, this Lifetime Maximum is five million dollars. You should accept no less than one million dollars of coverage for Organ Transplants.
BEWARE! Today, some plans only pay a $100,000 maximum benefit for organ transplants. Plans that offer limited organ transplant coverage are extremely risky, since organ transplant procedures often range in the neighborhood of $350-$500K. In addition, it is not uncommon for a transplant patient to need a second organ transplant. Keep in mind, that the $100,000 maximum payment for organ transplants on many plans also includes the cost of expensive anti-rejection medications. If you have an organ transplant, you will quickly reach the $100,000 maximum benefit, which means that you will be required to pay for costly anti-rejection medication out of pocket. This can lead to catastrophic out of pocket costs to the insured.
10. Does the plan have any separate "services deductibles" or "access fee" for each hospital admission or for each outpatient test? Some plans, like Assurant Health's "CoreMed" plan have a separate $750 hospital admission fee for the first three days of each hospital stay. These hospital admission fees may also be called "Access Fees" on other policies. Typically the insured is responsible for paying these access fees for each hospital admission in addition to their calendar year health plan deductible.
Many plans also have a separate deductible for emergency room visits. These deductibles are in place to discourage policyholders from using the emergency room as a doctor's office. Typically, these ER deductibles are waived if the patient is admitted to the hospital.
BEWARE! "Access fees" and "service deductibles" are separate from your plan's calendar year health plan deductible. Be aware that many plans now have benefit "caps" or "access fees" for out-patient services, such as, physical therapy, speech therapy, chemotherapy, radiation therapy, etc. These "benefit caps" could be as little as $500 for each out-patient treatment, which will leave the insured responsible for the remaining balance that is over $500.
Again, "access fees" are additional fees that you may have to pay per treatment before the insurance company will pay the provider. These fees can quickly add up. For example, if you need to have 40 outpatient chemotherapy treatments, and you must pay a $250 "access fee" per treatment, you would have to pay an additional 40 x $250 = $10,000.
Remember, purchasing a health plan is the most important purchase you will ever make. Insist that your insurance agent explain to you exactly what your health plan does and does not cover and take the time to read the "fine print" in the plan brochure and ask questions about terminology you don't completely understand.
In addition, when you receive your health insurance policy in the mail, don't just detach your insurance cards and place them in your wallet or purse and then throw your insurance policy in your desk drawer or filing cabinet. Take the time to sit down and read your policy page by page.
Once you receive your policy, you have a 10-day free look period, so if your coverage is not what you thought you purchased, you have time to call the insurance company and cancel the policy without incurring any fees.
Finally, if your being pitched a health plan that seems to good to be true (e.g. all pre existing conditions are covered, the plan is significantly cheaper than all other plans) contact your state's Department of Insurance BEFORE you buy the policy. Your state's Department of Insurance can tell you if the insurance company is registered in your state and can also tell you if there have been any complaints against that company that have been filed by policyholders.
Remember, if you suspect that your being scammed or you think the agent is trying to sell you a fraudulent insurance policy, (e.g. you have to become a member of a union to qualify for coverage) your state's Department of Insurance can also check to see if any prior disciplinary action has been previously taken against that agent.
Whatever decision you make in regards to your health insurance, please always remember to heed the following words of wisdom.
- "If it sounds too good to be true, it probably is!" ..........and
- "If you only buy on price, you get what you pay for!"
About the author: C. Steven Tucker, is the President of Small Business Insurance Services, Inc. He is a multi-state licensed insurance broker who has been serving the Small Business community and Self-Employed for 15 years. C. Steven has served as a Subject matter expert for the Wall Street Journal and Fortune Small Business Magazine and hosts his own internet radio show, entitled, "Health Insurance 101." He is also touted for being a consumer watchdog against greedy insurance companies, insurance scams and unscrupulous agents on Twitter.
If you are one of the 47 million Americans that have joined the ranks of the uninsured, what you may not know is that you may have to pay more for your medical treatment than your privately insured counterparts.
When individuals without insurance get sick, they usually have to pay much more for the same medical services for the simple reason that large insurance companies often negotiate lower with doctors, hospitals, pharmacies, and others health care providers for their policyholders.
This means that the average uninsured working man or woman who suffers a mild heart attack can be stuck with a hospital bill that is in excess of $30,000 compared to the $10,000, negotiated rate, which is charged to an insured patient's private insurance carrier. In many cases, uninsured individuals are charged 3-4 times more for the exact same medical treatment that is administered to patients with private insurance.
Additionally, uninsured patient with huge medical bills are usually aggressively pursued by collection agencies. In fact, new bankruptcy laws make it extremely difficult to discharge medical debt.
Statistically, if you don't have health insurance coverage, you have a 25% greater chance of developing a life-threatening disease or condition than those who have health insurance. Here are some startling statistics from the National Institute of Medicine (IOM) - an educational arm of the National Academy of Sciences:
- Lack of health insurance causes 18,000 unnecessary deaths per year.
- Adults without health insurance coverage have a 25% greater chance of dying from a disease or condition than those with health insurance coverage.
- The nation spends $65 to $130 billon a year in lost resources because of diminished health and premature deaths relating to uninsured Americans
Today, there are more uninsured Americans than any point in history. According to the U.S. Census Bureau, approximately 15.9 percent of Americans are walking around without health insurance coverage and paying for medical expenses out of pocket.
Although treatment for a sore throat or broken ankle can be a manageable medical expense for some families, more expensive treatments like surgery or chemotherapy can be financially devastating.
If you are the type of person that wouldn't risk driving your vehicle without car insurance, consider the fact that there is a statistically greater chance that you will suffer from an illness or injury than an auto accident.
About the author: C. Steven Tucker, is the President of Small Business Insurance Services, Inc. He is a multi-state licensed insurance broker who has been serving the Small Business community and Self-Employed for 15 years. C. Steven has served as a Subject matter expert for the Wall Street Journal and Fortune Small Business Magazine and hosts his own internet radio show, entitled, "Health Insurance 101." He is also touted for being a consumer watchdog against greedy insurance companies, insurance scams and unscrupulous agents on Twitter.
