I often get asked what are my options with health insurance. Despite what many people think there are many options.
Option 1- Group insurance. This is the kind of insurance you get from an employer. This is traditionally offered as a PPO (Preferred Provider Organization). Typically these plans offer benefits like Co-Pays for both doctors and prescriptions. They also have a smaller deductible for hospital based procedures. I do offer these services. I work with United, BCBS, Cigna, Aetna, Humana, Concordia and National General. Even if you are just a group of two, I can help!
Option 2- Affordable Care Act (Obamacare or Marketplace). This insurance often has a bad name. People have heard so many bad things about this option that they mere mention of it sends them off the edge. The ACA is (In Texas) either an HMO (Health Maintenance Organization) or EPO (Exclusive Provider Organization). As many people know these both offer smaller networks than a PPO. However, for those with pre-existing conditions ACA plans are often your best option if you do not work for a company with health insurance. These plans also have specific times to enroll and qualifiers if your are outside of this period.
Option 3- Short Term Insurance. This insurance is a great option for those that need insurance for a few months. They are deductible driven plans meaning that there are not a lot of benefits before you meet your deductible. These plans also work for those that are ok with a catastrophic style plan. These plans will allow enrollment year around. There are also options for 1 month to 36 months of continual coverage. So the term short term is a misnomer in those cases.
Option 4- Private health insurance. This insurance type is often an indemnity style plan. This simply means there is a fixed benefits paid for a particular service. These plans often work on either the Multi-plan or PHCS (Private health care systems) networks. While these are large national groups, there are many small groups under the bigger umbrella. These plans do not offer (usually) a out of pocket cap.
Option 5- Medical sharing. While this is not insurance, many Americans have these plans. This is simply of group of people (often faith based) who work together to share bills. This is often a cash pay system at the point of service and then a submission to the group for payment back to you.
Option 6- Medicare. This is only for those on disability or 65 years of age or older.
While there are many different aspects of life insurance policy design that you’ll want to understand before you take out a policy, the most fundamental thing to know is the difference between term insurance, universal insurance and whole life insurance.
Term life insurance provides a death benefit if the insured passes away during a certain time frame specified within the policy. While the policy may have some added benefits attached (such as spouse or child coverage riders) there is no cash value associated with the policy, so there is no surrender value if it is terminated.
Because term life insurance covers a specified time period and has no cash value accumulation, it’s less expensive than other types of life insurance. Most people use this type of life insurance to cover a specific period of time such as to cover the 30-year term on their mortgage or to cover the period of time while their children are still dependents.
Whole Life Insurance
While a term policy only pays a death benefit if death occurs in a specified time period, a whole life policy will provide a death benefit for life—as long as premium payments are made on time. Additionally, the policy has level premiums and will accrue cash values, which grow tax-deferred at a guaranteed rate. Once the cash values reach the same value as the death benefit (usually around age 100) the policy will mature (or endow) and the value will be paid out to the owner.
Much like a whole life policy, a universal life policy is meant to provide death benefit protection for the insured’s entire life. The major difference between the two is that universal life policies offer some flexibility in death benefit and premium. Cash values for universal policies grow tax-deferred based either on prevailing interest rates or their growth may be tied to the performance of a chosen index. With underwriter approval, you can increase the death benefit of the policy so that it includes the cash value portion. You can also reduce your premiums over time—even stop paying them altogether—if your cash values grow sufficiently. Because interest rates can rise and fall, it’s important to continually monitor the cash value performance to ensure that future plans to stop paying premiums can be supported.
There are now many other types of life insurance policies as well such as those linked to investments, those that provide long term care benefits, UL policies with no-lapse guarantee riders, or other hybrid products. Contact me today to make an appointment.
It’s quite similar to employer coverage you’ve had in the past. You paid your share of the monthly premium via paycheck deductions. That purchased the insurance coverage. Then when you used that insurance, you also paid your share of each medical service, right? You had co-pays at the doctor’s office. You probably also incurred a deductible if had surgery or hospital stay. It works the same with Medicare
What Medicare Pays For:
Part A pays for your first 60 days in the hospital. Your share of that cost is a hospital deductible, which will be $1364 in 2019. After 60 days consecutive days in the hospital, Medicare pays a diminishing share of your benefits. You begin paying a larger share in the form of a daily hospital copay. This can be hundreds of dollars per day, so you need supplemental coverage to protect you from those expenses on Part A services.
This can be hundreds of dollars per day, so you need supplemental coverage to protect you from those expenses on Part A services.
Part B pays for your outpatient care. This includes things like doctor visits, lab-work, imaging tests, surgeries, durable medical equipment, and even things like chemotherapy, radiation, and dialysis. After a small deductible that you pay once per year ($185 in 2019), Part B will cover 80% of all of these services for you.
Your share is the other 20% of all of these services, with no cap. That can be quite a bit of money for some of the bigger ticket items like surgeries or cancer treatments. You’ll need supplemental coverage to protect you from high Part B expenses.
Part D helps to pay for retail prescription medications. By that, we mean medications that you yourself pick up at a local pharmacy or via the plan’s mail order.
You do NOT need any supplemental insurance for Part D. It has built-in co-pays for medications so that you don’t get smacked with paying 100% for necessary medications. When the time comes, it’s easy to find the right Part D plan by using Medicare’s Plan Finder Tool.