Buying Health Insurance Tips
Insurance companies are reluctant to insure a diabetic’s health. If they do insure your health, it must be due to competition with other companies or compelled by laws or government policies. To safeguard their companies and reduce financial risks, insurance companies would limit diabetes riders, benefits as well as waiting periods.
It is natural that insurance companies are more careful in dealing with diabetics as diabetics make insurance claims more often on more health problems than anyone else. What worries insurance companies is not the amount claimed for syringes, meters, insulin and other diabetic supplies but severe diabetes complications like blindness, poor healing of cuts and broken skin, and problems with the blood circulation; all of which can cause insurance financial losses. Although initially, when the diabetic is still young and makes hardly any claims then, with age the probability of medical diabetic complications becomes too high for insurance companies to bear. To the insurance companies, it is possible that losses financially can be too great.
Nowadays, it is difficult for insurance companies to profit from medical insurance. You know that hospital beds now costs thousands of dollars per night when there was a time it was merely fifty dollars. Today, you have to pay for pills at $100 each and an appendectomy can cost thousands of dollars. The cost of everything in healthcare is rising steeply. With such costs, insuring diabetics can be too much of a burden to insurance companies.
Together with the rise in health cost are the unfavorable policies of the government which made many insurance companies close down. Since there are only a few companies remaining, it has become a sellers’ market where companies can choose and pick the people they want to insure as well as dictate on the terms and conditions for the medical benefits available and consumers have hardly any say on the matter.
Without a cure for diabetes, getting good medical insurance coverage will always be difficult for diabetics. Fortunately, health insurance can still be bought, if you get to know some basics of insurance law as well as underwriting practice.
Who has the say on what’s available
When it comes to what insurance companies can or cannot sell, it is not for them to decide. With the exception of national laws and regulations which covers the whole country, what can be sold to the people is determined by each state and there is no similarity in all states on the matter. So, a type of insurance sold in Illinois or Indiana may not be allowed in California. Even what is covered by a type of insurance differs from one state to another; with a kind of surgery covered in one state not covered in another. A diabetic in a certain state may not claim for the purchase of an insulin pump while that is possible in another.
The insurance commissioner of a state decides what can or cannot be sold in his or her state so long as the decision does not clash with laws of the state concerned or the country. Even how the person gets to be a commissioner differs from state to state, either elected or appointed by a political party. Within his state, this insurance commissioner decides the products to be sold, the company allowed to sell them, the price of the products and how such products can be available to citizens. The insurance commissioner holds complete power over these matters unless someone wins a challenge to his authority in court
Insurance companies certainly do not like the insurance commissioner but for the diabetics, the commissioner is a godsend especially when their claims are not allowed. So, diabetics ought to know the commissioner’s phone number for he is the one to look for support for any medical insurance claim when having to deal with a company which refuses your claim. If you need to contact the insurance commissioner, go to the phone book, request for it from the insurance department of your state, or visit the site of America’s Health Insurance Plans, which was once known as the Health Insurance Association of America, at www.ahip.org.
Comparing Individual and Group Plans
It is easier for a diabetic to get insurance cover as a group bought by the employer, perhaps through a union. When there is a group the total amount paid as premiums are certainly larger each month and when it comes to groups, the insurance companies compete to provide the cover by being not so strict on their restrictions, offering better benefits as well as not asking health questions.
Even groups of five, sometimes less, are accepted automatically by insurance companies in certain states. Do you know that in two of their periods of enrollment, even such a thing as a group of one is accepted in Maryland without any query on the applicant’s health if the person can be considered self-employed? This insurance cover is even offered to the self-employed applicant’s wife and young children. This kind of offer attracts people living outside Maryland to move into the state so as to enjoy the benefits as self-employed people applying for medical insurance for groups of one.
When you apply for an individual policy, there are bound to be questions on your health. So, it is difficult for anyone with type 1 diabetes to get coverage. Even those people with type 2 diabetes have to agree to have their diabetes connected benefits reduced if they wish to get insurance coverage.
Although the chances of getting insurance coverage as a group can be better, a person, especially if he is the youngest in the group may have to pay more than if he had purchased an individual insurance. For instance, if a person aged 20 were to join a group of people aged 50 or more, he would pay the same premium as the older people, based on the average age, claims history and as well as the benefits chosen. At his age, if an individual plan had been taken, his premium may be half of what he has to pay as a member of a group. For the individual plan, the insurance assessor would consider not just his age, but also his health background, height as well as the weight, use of cigarettes or alcohol and other personal matters. If his health is good with no chronic diseases, no smoking or alcoholic drinking and physically active, he can hope to pay lower premium rates.
However, being a diabetic makes you less favorable to an insurance company, so a group plan is still considered advisable. However, it must be understood that group rates change each year, with premiums and benefits possibly revised.
Even for healthy individuals, there is still the problem of getting affordable insurance. Without enough money for the premium, there is no point in being shown the best possible insurance plan. And insurance companies have to price their policies high enough to stay in business since cost of hospital stays and treatments are high. For instance, a three-day stay for the replacement of a hip can cost $50,000. Even a simple surgery without the need for hospitalization can be more than $4,000.
For persons who get medical coverage arranged by their employers or the workers’ union, they may have come across a kind of medical coverage known as the self-funded plan. It is a medical insurance plan taken by the employer or the union takes to cover part of the medical claims. They also buy an ’excess’ policy for payments of medical expenses which is more than what these employers and unions can pay. With yearly payments of a limited amount of medical expenses’ for each employee, it is possible for the employers to pay less premiums on medical insurance for all his employees. However, only big insurance companies have such self-funded plans. Such self-funded plans have been available to even small groups of five.
Compared to other insurance plans, self-funded ones are usually cheaper, but such plans are not under the control of the insurance laws of certain states and therefore, not in the favor of diabetics. The people who created this self-funded plan can choose the type of benefits given, without bothering about safeguards by the state on medical insurance as the ‘excess’ coverage, not the self-funded plan, is insurance coverage.
A diabetic should pay careful attention to matters concerning health conditions during the last twelve months and limited benefits in a self-funded plan before choosing between a self-funded or any other medical plan. Failure to do so can cause him a lot of misery at the time of making claims.
Comparing Indemnity and Managed-care Plans
Indemnity plans for individuals as well as groups are still offered for the payment of part, if not full, medical bills. When the bills exceed a certain sum or is regarded as excessive, the extra amount has to be borne by the insured. The insured of such indemnity plans is allowed to receive treatment from any doctor who is licensed.
Certain indemnity plans, known as preferred provider organizations (PPOs), preferred their insured to be treated by particular chosen medical practitioners. These chosen medical practitioners have made an agreement to accept a fee already agreed upon. The insured has to pay a small part of the fee. So, if a chosen medical practitioner usually charges $120 for a certain treatment, the practitioner may have agreed to accept $100 only for a patient in this PPO program with the insurance company paying $90 while the insured pay $10.
With this kind of agreement, the insurance company gets a discount on the payment while the medical practitioner is assured of his agreed payment and a constant supply of patients referred to him by the company.
HMOs (Health maintenance organizations) have in their employ doctors who treat all health problems in medical centers of their own, with the exception of emergencies in which a person’s life is at stake. However, there is a new breed of HMOs which allow their paid doctors to treat those not covered by their insurance.
For those HMOs with a very small number of members, having their own medical centers can be too expensive to maintain. So, such small HMOs merely have contracts with medical practitioners to treat their members at an agreed rate for treatment. Such medical practitioners are allowed to treat non-members and charging their own fees.There are some medical practitioners who have contracts with more than one HMO while also involved in a number of PPO plans.
Certain states ensure that HMOs pay non-participating medical practitioners a part of the bill whenever they treat HMO members. In such states, consumers find it difficult to differentiate a PPO from a HMO. Fortunately, it does not matter much at times when claims are made as the commissioner who settles any dispute that comes from either PPO or HMO is the same person.
Since the enactment of a federal law known as the COBRA (Consolidated Omnibus Budget Reconciliation Act), diabetics who have bought a group insurance coverage do not have to worry about it being discontinued should they leave their company, for COBRA ensures that the employer of 20 or more employees offer such employees the choice to carry on having the medical benefits of the group for as long as 18 to 36 months. Although the said employees’ premium with an additional payment has to be paid by the employee, he cannot be denied the desire to continue with the insurance except if the reason for the termination is cheating or any other criminal offence.
Although COBRA was beneficial to the employees, there is a limit to its usefulness as employers of less than 20 employees are not subjected to it. COBRA does not ensure that coverage can be continued should the group policy be cancelled by the employer. Certainly, no single employee can continue with the policy once the employer cancels it.
COBRA’s weaknesses were eventually overcome with Congress’ enactment of the HIPPA (Health Insurance Portability and Accountability Act). It ensures the right of employees to have insurance coverage even if the employee stops working or the employer cancels the group policy. HIPAA ensures that the affected person can buy his or her own medical insurance policy if, according to the law, he or she qualifies for it.
However, individual insurance plans guaranteed by the HIPAA are different from conversion policies. Conversion plans are individual plans converted from group plans and these have usually been offered by underwriters to employees who have stopped working for an employer and accept the offer within a 30 period. The benefits offered by a conversion plan are not as much as those in an individual plan bought by a person who is healthy. A conversion plan can be renewed but if the policy holder wishes to switch to another individual policy, this is not guaranteed by the HIPAA.
HIPAA ensures that an individual can get the same type of coverage as any other person if the person who has some kind of health problem is willing to pay a higher premium for his policy. This higher premium can only be charged by the insurance company with the approval of the state. So, with the HIPAA, as long as a person can afford his premiums, and he or she can get medical coverage through an employer’s group policy, he will be assured of medical coverage always.
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The best plan for people with diabetes
As mentioned earlier, it is more beneficial for a diabetic to get a group policy when compared to an individual policy. Since there is an investigation into a person’s health when it comes to individual plans, it is easier to buy a group policy. Although different plans and states have different requirements, the group policy has less conditions for eligibility, benefits which are excluded, and waiting time for approval of policy which are generally the case with individual plans.
For diabetics who have many choices in the coverage offered by the employer or the union, they have to assess the advantages and disadvantages of each plan to get what is the most advantageous. For diabetics living in big cities with many HMO medical centers, that should be considered. Normally, there is less expenses at the time a claim is made when it comes to HMO, when compared to indemnity policies or self-funded policies. On the other hand, HMO premiums are higher than those of the other two plans and it wants the member to use only its practitioner. This can be the deciding factor in your choice.
Indemnity policies as well as PPOs allow a policy holder to choose the practitioner he wants and is cheaper when it comes to premiums.However, at the time a claim is made, the policy holder needs to pay more on medical fees.
Self-funded policies work the same way as PPO as well as the usual medical programs. They allow a person his own choice of doctor although they do encourage the participants to go to particular doctors by lessening their portion of the doctor’s bill. However, it has to be remembered that self-funded plans are not controlled by the insurance commissioner of the state. Furthermore, the benefits can be less than those covered by other insurance plans.
As can be seen, the ideal medical insurance plan does not exist. Although supporters of socialized medicine may claim such an ideal system exists in Canada and Britain, a closer look at them proves otherwise. With the free market economic system, sufficient medical insurance is the best way to look after our medical expenses. Even though our medical system and medical insurance are not perfect, a diabetic discovers that any insurance policy is certainly better than not having an insurance policy.