In today’s complex healthcare landscape, understanding medical benefits is essential for individuals and families to access quality care while managing costs. Medical benefits encompass the coverage and services provided by health insurance plans or programs, offering financial protection against unforeseen medical expenses. This comprehensive guide aims to demystify the intricacies of medical benefits, empowering readers to make informed decisions about their healthcare coverage.
The Basics of Medical Benefits:
Medical benefits are the array of healthcare services covered by insurance plans, including doctor visits, hospital stays, prescription medications, preventive care, and more. These benefits serve as a financial safety net, shielding individuals from the full burden of healthcare expenses and ensuring access to necessary treatments.
Types of Health Insurance Plans:
Health insurance plans come in various forms, each designed to meet the diverse needs of individuals, families, and groups. Understanding the different types of health insurance plans is crucial for selecting coverage that aligns with your healthcare requirements and financial situation.
Employer-sponsored health insurance is provided by employers to their employees as part of their benefits package. These plans often offer comprehensive coverage at lower costs compared to individual plans, as the employer typically subsidizes a portion of the premium. Employer-sponsored plans may include options such as Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPOs), or High Deductible Health Plans (HDHPs) with Health Savings Accounts (HSAs).
Individual or family health insurance plans are purchased directly by individuals or families from insurance companies or through government-run marketplaces (such as the Health Insurance Marketplace in the United States). These plans offer flexibility in coverage options and provider networks, allowing individuals to tailor their insurance to their specific needs. Individual plans may include HMOs, PPOs, Exclusive Provider Organizations (EPOs), or Catastrophic Plans, depending on the insurer and region.
Government Programs:
Government-sponsored health insurance programs provide coverage to specific groups of individuals who meet eligibility criteria. These programs aim to ensure access to healthcare services for vulnerable populations and those with low incomes. Examples include:
Medicare: A federal program that primarily provides health insurance for people aged 65 and older, as well as younger individuals with certain disabilities or medical conditions. Medicare consists of several parts, including Part A (hospital insurance), Part B (medical insurance), Part C (Medicare Advantage), and Part D (prescription drug coverage).
Medicaid: A joint federal and state program that offers health coverage to eligible low-income individuals, families, pregnant women, children, and people with disabilities. Medicaid eligibility and benefits vary by state.
CHIP (Children’s Health Insurance Program): A state and federally funded program that provides low-cost health insurance to children in families that earn too much to qualify for Medicaid but cannot afford private insurance.
Medicare Advantage (MA) plans, also known as Medicare Part C, are offered by private insurance companies approved by Medicare. These plans provide all the benefits of Original Medicare (Parts A and B) and often include additional benefits such as prescription drug coverage, vision, dental, and wellness programs. Medicare Advantage plans may be HMOs, PPOs, Private Fee-for-Service (PFFS) plans, or Special Needs Plans (SNPs), each with its own network and coverage options.
Supplemental Insurance Plans:
Supplemental insurance plans, also known as Medigap or Medicare Supplement plans, are designed to fill the gaps in coverage left by Original Medicare (Parts A and B). These plans are sold by private insurance companies and can help pay for out-of-pocket costs such as deductibles, copayments, and coinsurance. Supplemental plans are standardized by the government and identified by lettered plans (e.g., Plan A, Plan B), each offering a different level of coverage.
Key Components of Medical Benefits:
Medical benefits encompass various elements that determine how individuals access healthcare services and share the financial responsibilities associated with their care. Understanding these key components is essential for navigating health insurance plans effectively and maximizing coverage while managing costs.
Premiums:
Premiums are recurring payments individuals make to maintain health insurance coverage. These payments may be deducted from employees’ paychecks for employer-sponsored plans or paid directly by individuals for individual or family plans. Premium amounts can vary based on factors such as age, location, coverage level, and the type of plan selected. Paying premiums ensures individuals remain enrolled in their health insurance plan and eligible for coverage.
Deductibles:
A deductible is the amount individuals must pay out-of-pocket for covered medical services before their insurance plan begins to pay for those services. Deductibles can vary widely among plans, with higher deductibles often associated with lower premium costs. Meeting the deductible is typically an annual requirement, meaning individuals must reach this threshold each year before certain benefits, such as coinsurance or prescription drug coverage, apply.
Co-payments and Co-insurance:
Co-payments (co-pays) and co-insurance are forms of cost-sharing where individuals pay a portion of the cost of covered services, while the insurance plan pays the remainder. Theare fixed amounts paid for specific services or prescriptions, such as a $20 co-pay for a doctor’s office visit or a $10 co-pay for generic medications. Co-insurance, on the other hand, requires individuals to pay a percentage of the total cost of covered services, often after meeting the deductible. For example, if a plan has a 20% co-insurance rate for hospital stays, the individual would pay 20% of the total bill, while the insurance plan covers the remaining 80%.
Networks:
Health insurance plans often establish networks of healthcare providers, including doctors, hospitals, specialists, and other medical professionals, with whom they have negotiated discounted rates. Individuals can typically save money on healthcare costs by using in-network providers, as these providers have agreed to accept lower fees for services rendered. Plans may offer different levels of coverage for in-network versus out-of-network care, with higher out-of-pocket costs associated with services provided by non-network providers.
Out-of-network Coverage:
While in-network providers offer cost savings and predictable out-of-pocket expenses, individuals may still have the option to seek care from out-of-network providers. However, out-of-network care often comes with higher costs, including higher deductibles, co-payments, and co-insurance rates, as well as potential balance billing. Before receiving out-of-network care, individuals should review their insurance plan’s coverage policies and understand their financial obligations for such services.
Preauthorization:
Preauthorization, also known as prior authorization or pre-certification, is a process by which individuals or healthcare providers obtain approval from the insurance plan before certain medical services or treatments are rendered. It helps ensure that services are medically necessary and covered under the individual’s insurance plan. Common procedures requiring pre authorization may include elective surgeries, advanced imaging tests, specialty medications, and durable medical equipment. Failure to obtain preauthorization when required may result in denial of coverage or higher out-of-pocket costs for the individual.
Claim Process:
The claim process involves healthcare providers submitting claims to the insurance company for reimbursement of covered services provided to patients. After receiving a claim, the insurance company reviews it for accuracy and adherence to the terms of the individual’s policy. Once approved, the insurance company pays its portion of the covered expenses directly to the provider, and the individual may be responsible for any applicable deductibles, co-payments, or co-insurance amounts. Individuals should review their Explanation of Benefits (EOB) statements from the insurance company to verify the services provided, the amount paid by the insurance plan, and any remaining balance owed.
Annual Limits:
Some health insurance plans impose annual limits on certain types of coverage, placing caps on the total amount the insurance company will pay for covered services within a given year. These limits may apply to specific benefits such as prescription drugs, mental health services, or rehabilitative therapies. Annual limits help insurance companies manage costs and mitigate financial risk but may pose challenges for individuals with extensive healthcare needs. Understanding and monitoring annual limits is essential for individuals to plan and budget for their healthcare expenses effectively.
Understanding Your Plan:
Review your insurance plan’s benefits summary or explanation of benefits (EOB) to understand covered services, cost-sharing responsibilities, network providers, and exclusions and limitations. Pay attention to terms like premiums, deductibles, co-payments, and maximum out-of-pocket expenses to gauge your financial responsibility.
Navigating Healthcare Networks:
Health insurance plans often utilize networks of healthcare providers, including doctors, hospitals, specialists, and other medical professionals, to offer discounted rates and streamline access to care. Understanding how to navigate these networks is essential for individuals to maximize their insurance benefits, control out-of-pocket costs, and receive quality healthcare services. Here are key aspects of navigating healthcare networks:
Understanding In-Network vs. Out-of-Network Care:
In-network providers are healthcare professionals and facilities that have contracted with the insurance company to provide services at negotiated rates. Choosing in-network providers typically results in lower out-of-pocket costs for individuals.
Out-of-network providers, on the other hand, are not contracted with the individual’s insurance plan. While individuals may still seek care from out-of-network providers, they often face higher costs, including higher deductibles, co-payments, and co-insurance rates.
Reviewing Provider Directories:
Insurance companies typically provide online directories or lists of in-network providers for individuals to reference when seeking care. These directories include information such as provider specialties, office locations, contact details, and languages spoken.
When considering healthcare providers, individuals should verify their participation in the insurance plan’s network to ensure optimal coverage and minimize potential out-of-pocket expenses.
Verifying Network Participation:
Before scheduling appointments or receiving medical services, individuals should directly verify a provider’s network participation status with both the provider’s office and their insurance company.
It’s crucial to confirm that the provider is in-network for the specific insurance plan and coverage level, as networks can vary among different plan options offered by the same insurance company.
Utilizing Provider Search Tools:
Many insurance companies offer online provider search tools or mobile apps that allow individuals to search for in-network providers based on criteria such as location, specialty, language preference, and accepted insurance plans.
These tools streamline the process of finding suitable healthcare providers within the insurance plan’s network, enhancing convenience and accessibility for individuals seeking care.
Considering Referrals and Authorizations:
Some health insurance plans, particularly Health Maintenance Organizations (HMOs), require individuals to obtain referrals from their primary care physician (PCP) before seeing specialists or receiving certain medical services.
Additionally, certain procedures or treatments may require preauthorization from the insurance company to ensure coverage. Individuals should familiarize themselves with their plan’s referral and preauthorization requirements to avoid unexpected expenses.
Exploring Telemedicine Options:
Telemedicine services, which allow individuals to consult with healthcare providers remotely via video or phone, have become increasingly popular and accessible, particularly within insurance networks.
Many insurance plans offer coverage for telemedicine visits with in-network providers, providing convenient access to medical care for non-emergency issues while potentially reducing costs and eliminating the need for in-person appointments.
Seeking Assistance from Customer Service:
If individuals encounter challenges or have questions about navigating healthcare networks, they can contact their insurance company’s customer service department for assistance.
Customer service representatives can provide information about network coverage, assist with locating in-network providers, clarify coverage policies, and address concerns related to accessing care.
Maximizing Benefits:
Maximizing benefits involves leveraging the features and resources provided by health insurance plans to optimize healthcare access, minimize out-of-pocket costs, and prioritize preventive care. By understanding how to make the most of their insurance coverage, individuals can enhance their overall health and well-being while effectively managing healthcare expenses. Here are key strategies for maximizing benefits:
Utilize Preventive Services:
Most health insurance plans cover preventive services at no additional cost to the individual, including screenings, immunizations, and wellness visits.
Take advantage of preventive care benefits by scheduling routine check-ups, screenings for conditions such as cancer and diabetes, and vaccinations recommended by healthcare professionals.
Preventive services can help detect health issues early, promote healthy lifestyle habits, and prevent the progression of chronic diseases, ultimately reducing the need for costly treatments in the future.
Understand Coverage Details:
Familiarize yourself with the specifics of your health insurance plan, including covered services, deductibles, co-payments, co-insurance rates, and out-of-pocket maximums.
Review your plan’s benefits summary or explanation of benefits (EOB) to understand the extent of coverage for different types of medical care and any limitations or exclusions.
Knowing your coverage details can help you make informed decisions about seeking healthcare services and avoid unexpected expenses.
Choose In-Network Providers:
Selecting healthcare providers within your insurance plan’s network can result in lower out-of-pocket costs, as in-network providers have agreed to accept negotiated rates from the insurance company.
Use your insurance company’s provider directory or online search tools to identify in-network doctors, hospitals, specialists, and other healthcare professionals.
Before scheduling appointments or receiving services, confirm that the provider participates in your plan’s network to ensure optimal coverage and minimize potential expenses.
Explore Telemedicine Options:
Telemedicine services offer convenient access to healthcare professionals via phone, video, or online messaging, allowing individuals to receive medical advice, diagnosis, and treatment remotely.
Many health insurance plans provide coverage for telemedicine visits with in-network providers, often at lower costs than traditional in-person appointments.
Explore telemedicine options for non-emergency medical issues, routine follow-ups, or consultations with specialists, especially if you prefer the convenience of virtual visits or face logistical challenges accessing traditional healthcare settings.
Participate in Wellness Programs:
Some health insurance plans offer wellness programs, incentives, or discounts to encourage healthy behaviors and proactive management of chronic conditions.
Take advantage of wellness resources such as health coaching, fitness memberships, smoking cessation programs, and nutrition counseling offered through your insurance plan.
Participating in wellness programs can improve your overall health outcomes, reduce the risk of costly medical complications, and potentially earn rewards or incentives from your insurance provider.
Review Prescription Drug Coverage:
Understand your plan’s prescription drug coverage, including formularies, co-payment or co-insurance requirements, and options for mail-order pharmacy services.
When prescribed medications, discuss generic or lower-cost alternatives with your healthcare provider to minimize out-of-pocket expenses.
Consider using preferred pharmacies or mail-order prescription services offered by your insurance plan to access medications at reduced costs and maximize coverage benefits.
Stay Informed and Advocate for Yourself:
Stay informed about changes to your health insurance plan, coverage policies, and network providers by reviewing plan documents, updates, and communications from your insurance company.
Advocate for yourself by asking questions, clarifying coverage details, and seeking assistance from customer service representatives or healthcare professionals when needed.
Be proactive in managing your healthcare needs by scheduling preventive screenings, addressing health concerns promptly, and adhering to recommended treatment plans. Doing all this will optimize your health outcomes and maximize the value of your insurance benefits.
By implementing these strategies for maximizing benefits, individuals can effectively navigate their health insurance coverage, access quality healthcare services, and prioritize their health and well-being while managing healthcare costs. Taking proactive steps to understand coverage details, utilize preventive care, choose in-network providers, explore telemedicine options, participate in wellness programs, and stay informed can help individuals make the most of their insurance benefits and achieve better health outcomes in the long run.
Conclusion:
Understanding medical benefits is paramount in today’s healthcare landscape, where access to quality care and financial protection are paramount. By grasping the fundamentals of health insurance plans, navigating provider networks, and maximizing benefits, individuals can effectively manage healthcare costs and make informed decisions about their well-being. Empowered with knowledge and resources, individuals can navigate the complexities of medical benefits with confidence, ensuring they receive the care they need when they need it.
Working With EZ
There are numerous factors to consider while deciding on your own health insurance. Nobody wants to spend hours reading about different plan benefits and prices, so why not have a professional do all the work for free? There is a way to get low-cost health insurance without going through a lot of hassle. A trained EZ insurance representative can discuss the advantages and disadvantages of each plan all the while helping you devise the ideal plan for you. Working with an EZ agent saves you time and stress because you don’t have to decipher legal jargon or read fine print. Agents handle all of the work, so you can be assured that your coverage will best match your financial and medical needs.
Not to mention that EZ agents can help you save hundreds of dollars every year on your health insurance premiums. We accomplish this by being able to search for the lowest prices both on and off the market. We can also locate and apply any savings you may be able to obtain. However, we do more than just assist you pick a plan. We can also assist you maintain it up to date. We can assist you file claims with your insurance company and renew your coverage when it’s time. To get started, enter your zip code in the box below or call 877-670-3557 to speak with one of our licensed representatives.
There are a lot of moving parts involved in health insurance. As well as a lot of terminology to learn in order to understand your plan and its costs. Two of the most important terms to understand are premiums and deductibles. These are the two out-of-pocket expenses associated with your health insurance plan that will end up costing you the most money. Understanding these two terms, the difference between them, and how each operates will help you to better choose the best plan for your budget. Below we’ll explain how these two health insurance costs are interdependent and have an impact on each other.
Premiums
Like a Netflix or Spotify subscription, premiums are a monthly payment you make to maintain a service. In this case your health insurance plan. If you purchase an individual plan on the Health Insurance Marketplace, you will pay your premiums in their entirety. But you might be eligible for subsidies or tax rebates. If your employer offers a group health plan, the cost of your health insurance premiums may be partially or entirely covered by your employer.
How much you pay in premiums will vary based on several factors. Such as the policy you choose, the number of people in your family, and the insurance company you go through. In addition, when determining your premium, insurance companies may take into account factors such as your age, where you live, and whether or not you smoke cigarettes. For instance, because healthcare costs are assumed to increase with age, premiums for older adults are higher.
Premiums for individual health plans and family health plans function in the same way. There is only one payment required each month, so the cost itself is the only difference. The cost of your premium will be higher the more people who are covered by it. But, if you do the math, you might find that you’re paying less per person for a family plan than you would if you all had your own separate plans.
The only time this might not be the case is when someone in your family has significant health issues and another person rarely sees the doctor. In this case, it might be better to find plans that have lower premiums and higher deductibles for the healthier family member. And a plan with higher premiums and a lower deductible for the family member who needs more medical care. Let’s see why by taking a closer look at how deductibles work.
Deductibles
In most cases, your insurance plan will have an annual deductible. Which you will have to meet before your health insurance begins paying for any of your medical care costs. “Meeting” your deductible means that you will have to pay that amount in covered expenses to get coverage for anything other than preventive care. So, if your plan has a $2,000 deductible, for example, you’ll have to pay $2,000 out-of-pocket for things like lab work, minor surgeries, tests done at your doctor’s office, etc., and then your insurance plan will begin covering those things.
There are a variety of ways deductibles can work, and which medical expenses will count towards meeting them. Health insurance policies for individuals and families may include a deductible structure. In which the insurance company is not obligated to pay for services until the deductible has been met. But in some cases, a plan may cover some medical expenses before the deductible is met while excluding others. In addition, certain expenses like copayments won’t count towards your deductible.
Individual vs. Family Deductibles
Health insurance deductibles can either be applied per person or per family. The way individual deductibles work is fairly straightforward, while family deductibles can be a bit more complicated.
Individual – First, the easy part. If you have an individual health insurance policy, the money you spend on qualified medical expenses will count toward meeting your deductible. Once your plan’s deductible is met, you and your insurance company will begin dividing the remaining costs. Meaning you will pay what’s known as “coinsurance,” or a certain percentage of each bill. You’ll do this until you reach your policy’s out-of-pocket maximum.
Family – This is where things can get confusing, because your plan might have both an individual deductible and a family deductible. There are two main categories of family deductibles: embedded and aggregate. An aggregate deductible works the same as an individual deductible. Your plan will have one deductible, and everyone on the policy will be paying towards it.
Embedded deductibles, though, is where the confusion sometimes comes in. With an embedded deductible plan, there is both a family deductible and an individual deductible. So, each member of the family has a separate deductible in addition to the family’s deductible. Once a family member’s deductible is met, the insurance policy begins covering 100% of that person’s healthcare costs. Everyone else in the family will still have to meet their own deductible after that member’s deductible is met.
In addition, there is also a family deductible with these plans. And all family members will begin to have their expenses covered once the family deductible is met. Everyone will have to only pay their coinsurance until the out-of-pocket maximum is reached, once the family deductible is met.
Costs
The cost of your premiums and the amount of your deductible will depend on a variety of factors. It is difficult to give an accurate estimate of what you’ll pay without knowing your unique circumstances. Wut we can say that the average monthly premium price in the country is $456 per month.
Check out our state-by-state health insurance guides to learn more about how the health insurance market is regulated in your state. And to get a baseline estimate of the costs. You can also learn more about the health insurance plans that are available in your state. As well as ways to reduce the cost of your coverage.
As for deductibles, the average nationwide deductible amount depends on the metal tier you choose for your plan: Bronze, Silver, Gold, or Platinum. Keep in mind, lower deductibles mean a higher premium.
The average annual deductible amount for each tier is as follows:
Bronze – $7,482
Silver – $4,890
Gold – $1,650
Platinum – $745
How Premiums and Deductibles Work Together
Insurance premiums and deductibles are interrelated costs. Your plan’s premiums will be higher if the deductible is lower, for example. So, generally, your plan will either have a higher monthly premium with a lower deductible, or a lower premium with a higher deductible.
If you’re wondering which type of plan would be better for you. Consider that a higher premium with a lower deductible would be more appropriate for someone who has a pre-existing condition and needs to see the doctor frequently. And if you don’t often see the doctor or generally spend a lot on medical services, having a higher deductible won’t be as much of an issue for you. And you might be better off spending less on your premiums.
FAQs
How can I lower my premiums?
If you have individual coverage, and your household’s annual income is less than or equal to 400% of the federal poverty level, you might be eligible for subsidies or tax rebates. Which can lower the price of your premiums. If you have group health insurance through your employer, they might offer you reduced health insurance premiums or other incentives if you are able to meet certain health and wellness criteria.
What will increase my premiums?
Your health insurance premiums may increase for a variety of reasons. Including but not limited to inflation, adding family members to your plan, and relocating to an area with a higher cost of living. It’s also possible that your monthly health insurance premiums will go up if you opt for a plan with more generous benefits. Consider the policy’s premium in light of its benefits before making your decision.
Are premiums tax deductible?
If you have a plan through either the federal or state Health Insurance Marketplace, your premiums are tax deductible. If you’re self-employed, health insurance premiums are tax deductible. And you may also be able to deduct the premiums you pay for long-term care insurance. Before submitting a tax deduction claim, you may want to consult a tax expert.
Is a high or low deductible plan better for me?
If you do not anticipate having many medical expenses during the next plan year, selecting a health insurance policy that has a high deductible could give you the best value. When you anticipate having a lot of medical expenses in the near future, such as if you plan on having a baby, selecting a plan with a low deductible could help you get the most value out of your coverage.
What does “no-charge” deductible mean?
If you have a plan with a “no-charge” deductible, your plan will pay 100% of eligible medical expenses after you meet your deductible for the year. No-charge deductibles tend to be higher. But if you plan on using a lot of medical services for the year, it might balance out when you are no longer required to pay anything out-of-pocket.
How EZ Can Help
EZ.Insure provides access to local, highly trained insurance agents. Who will shop around for the best policy at the most affordable price. We can save you hundreds of dollars a year by searching both on and off the Marketplace for a plan that fits your needs. We can also find out if you’re eligible for any local discounts. And then apply them to your plan for you. And the best part is that we do all of this for free! To find out how much you could be saving, simply enter your zip code on the box below for free, instant quotes. Or call us at 877-670-3557 to speak to an agent who can answer all of your questions and find you the perfect plan.
Finding one insurance plan that’s right for you can seem like a big task. But in some cases, you might actually be wondering if it’s possible to have two health insurance plans. And the answer is yes: it is possible and legal to have two policies, a primary and secondary health insurance policy. And while it might seem like a lot of extra work to research and maintain two plans, having two different health insurance plans can actually help you save money on the overall cost of your medical care and treatment.
With that being said, having two plans can also mean paying twice as much each month for your premiums. As well as twice as much for your deductible. So if you are considering purchasing additional coverage, you’ll need to give serious thought to whether or not enrolling in a second health insurance plan would be the best option for you.
To help you make this decision, we’ve broken down how primary and secondary insurance policies work. So you can understand the difference and get a better idea of how two policies could work for you. And, as always, if you have any questions, or need help looking for the right policy – or policies – for you, contact an EZ agent!
Primary Insurance
Your primary plan will be the plan that will first cover any necessary medical care. This plan will pay before your secondary insurance plan kicks in. For instance, if you need to see a doctor or buy prescription drugs, your primary insurer will cover the costs of these services up to the coverage limits that it provides. Remember, though, as with any health insurance plan, you may still be responsible for cost-sharing, like coinsurance.
Secondary Insurance
In most cases, if you have a secondary insurance plan, it won’t begin to pay out benefits until after your primary insurance plan has exhausted its available coverage. After your primary insurer has paid its share of your medical costs, your secondary plan will begin to take effect to cover any additional costs that remain.
How to Get Two Plans
Getting secondary health insurance is similar to getting primary health insurance, but there are some differences to keep in mind. Here are the steps to getting a second policy:
Assess your primary policy – Review the policy documents for your current plan to find out what services are covered, how cost-sharing works, and what coverage limits there are. Think about your current and future health needs to find any gaps in your coverage.
Research secondary options – Options for secondary coverage range from plans that cover just one type of health service to plans that cover everything. Find out what kinds of plans are available to you and choose the one that fills in the gaps in your current coverage the best.
Understanding coordination of benefits – People can’t choose which of their two health plans is the “secondary” one. Before you sign up for another plan, make sure it will pay after the one you already have.
Apply and purchase – To sign up, follow the instructions for the plan you’ve chosen. Fill out the forms carefully and be ready to answer questions about your current health insurance. Pay your first month’s premium after getting approved for coverage.
How Does Having Two Plans Work?
When you have a medical bill, the first insurance that pays out is your primary insurance. It will pay up to its coverage limits. Then your secondary insurance will kick in and can pay part or all of the remaining costs. Please be aware that there are limits to the coverage provided by both the primary and secondary insurance. If the secondary insurer does not pay in full, the remaining balance will be your responsibility. Therefore, it is possible that you will have some remaining out-of-pocket medical costs. Even if you carry multiple health insurance policies.
There is a good chance that a Coordination of Benefits clause is included in your health insurance policy. This clause will lay out the predetermined order of how your plans will pay for your covered services. So, in the event that you or your medical provider file a claim for your care, the Coordination of Benefits document will specify which plan is accountable for making payments.
Examples of Primary and Secondary Plans
So, if you have more than one insurance policy, which policy is considered primary and which is considered secondary will be determined by your circumstances. The following are some examples of how primary and secondary plans work for different groups of people:
Married Couples – Say a wife has her own insurance but she is also covered under her husband’s group insurance from his job. The wife’s primary insurance would be her individual plan and her husband’s group coverage would be the secondary.
Minors under 26 – Under the Affordable Care Act, dependents can remain on their parents’ insurance until age 26. This means that an adult under this age could get their own health insurance policy from their employer while still being covered by the family policy. If that’s the case, the child’s health insurance would be the primary plan. And the parent’s would be the secondary plan.
Parents with separate plans – Say you are under 26 and still on your parent’s health plan. If they both have separate plans and you’re listed on both of them, you have dual coverage. The primary and secondary coverages are determined by a “birthday rule”. Meaning whichever parent’s birthday is earlier in the year will give you your primary insurance. And the one with the later birthday will give you your secondary plan. For example, if your mom’s birthday is in January and your dad’s birthday is in March. Your Mom’s insurance would be your primary coverage. This isn’t about which parent is older – the birth year doesn’t affect the order, only the birth month.
Medicare beneficiaries with group health plans – If you are 65 or older and on Medicare, but are still working and have insurance through your employer, Medicare will be your primary insurance if the company you work for has fewer than 20 employees. If your company has 20 or more employees, your group plan will be primary and Medicare will be secondary.
Out-Of-Pocket Costs
The cost of having two plans will generally be higher than the cost of having one plan. Since you will have to pay the premiums and deductibles for each of your health insurance policies. For example, consider this: you will not be able to use your secondary coverage to cover your primary’s deductible. You will also have to pay any copayments and coinsurance that are associated with each plan.
It’s also important to note that the rules of your primary plan will apply to both of your policies. So, for example, if your primary plan is a PPO plan. Your primary policy may stipulate that you can only use certain doctors and hospitals in your plan’s network. Your primary insurance won’t pay anything if you go to a doctor who isn’t in their network. The secondary insurance won’t either because you broke the primary plan’s rules by going to an out-of-network doctor.
In addition, if your provider charges you more than what your plan(s) considers to be reasonable, customary, or allowed under plan rules, you may have to pay the difference. A licensed insurance agent from EZ can help you understand the out-of-pocket costs associated with each of your plan options.
Weighing Your Options
There are positives and negatives associated with choosing to have a primary and secondary insurance plan. Just as there are with any other type of insurance. Let’s take a look at the pros and cons to help you decide if having two plans might be right for you.
Benefits
Extra Coverage – Having two plans could come in handy in the case of unanticipated medical expenses. And if you find that you frequently have to pay for your own medical expenses out-of-pocket, it may be beneficial to purchase a secondary health insurance policy.
No Gaps – Even if one of your health insurance policies lapses, you won’t experience a gap in coverage if you have a second plan. Your secondary health insurance will just become your primary automatically.
Complementary coverage – Having plans that are complementary, that cover different elements of your healthcare, will mean you’ll get more coverage and better benefits. You’ll be able to make up for what your primary health insurance doesn’t cover with your secondary plan.
Disadvantages
No guarantee – Even if you have two separate health insurance policies, your out-of-pocket costs may still not be covered in full. Keep in mind that the amount of your plans’ coverage cannot be more than the amount of your out-of-pocket expenses.
Extra expenses – Your two separate health insurance policies will still require you to make payments on the associated premiums and deductibles. This may result in additional expenses further down the road.
Overlapping – It’s possible that your coverage from two different health insurance plans will actually overlap if the plans are too similar to one another. Meaning you will not receive as many additional benefits as you might like.
FAQs
What is the birthday rule?
When children are covered by both parents’ health insurance policies, the birthday rule plays a significant role in determining which plan provides primary coverage and which provides secondary coverage. According to the birthday rule, whichever parent’s birthday falls earlier in the year will be the primary insurer. Secondary insurance is provided by the other parent’s plan. The year of birth of each parent does not come into play.
How do I know which is my primary insurance?
You don’t get to choose which plan will be your primary coverage and which will be your secondary coverage. Whenever you file a claim, your primary health plan will cover you as if you didn’t have a secondary plan. After that, your secondary health insurance will cover the rest of the bill. If you have two health plans, there are rules about how your benefits will work together. Some of these rules will be different for you based on your health insurance company and your situation.
Is having 2 plans worth it?
It depends. Having two health plans can save you money if one is free or both are inexpensive. Also, it’s best to make sure they work well together. Check to see if their coverages and benefits overlap or are too similar.
EZ Is Here to Help
Having both primary and secondary coverage can be complicated. It could work for you, but you’ll need to weigh the pros and cons carefully before deciding whether or not to invest in a secondary insurance policy. Feel free to ask EZ anything. Including if having two plans might be right for you, as well as for assistance in locating a secondary health insurance plan, if necessary. We will compare plan benefits and costs for you. And will assist you in locating affordable coverage that meets your needs. Simply enter your ZIP code below to get started with free, customized quotes right now! You can also give us a call at 877-670-3557 to have a qualified insurance professional discuss your needs and help you choose the best policy for you.
The government has finally announced the new standard monthly premiums for Medicare Part B. And after all the speculation about rate hikes, rates will actually be decreasing a little bit next year. Not only that, but the annual deductible for Medicare Part B will also be lower next year. With many Medicare beneficiaries struggling with increased healthcare costs, this decrease in rates should be helpful. So what will you be paying for Medicare Part B in 2023?
Medicare Part B Premium
The new standard monthly premium for Part B will be $164.90 next year, which is about 3% lower than it is this year.
2022 saw a large increase in Medicare Part B premiums because of projected spending on Aduhelm, a new drug for treating Alzheimer’s disease. Now that spending on the drug, and other treatments and services, has gone down, Part B once again has more financial reserves. This is allowing Medicare to lower next year’s premiums for Medicare beneficiaries.
Medicare Deductibles
Medicare Part B premiums are not the only costs that are going down. The annual deductible for Part B will be $226 for 2023, which is a $7 decrease from $233 in 2022.
But while the Medicare Part B deductible is going down, the deductible for Medicare Part A will go up $44 from this year’s $1556, making it $1,600 in 2023. For the 61st through 90th day of hospitalization, coinsurance will be $400 per day, up from $389 this year. For lifetime reserve days, the charge will be $800 per day (up from $778 in 2022).
IRMAA Changes
Income-related adjustment amounts, or IRMAAs, will kick in for single beneficiaries at the modified adjusted gross income amount of more than $97,000, up from $91,000 this year. For married beneficiaries filing a joint tax return, the extra monthly charge will apply if income is above $194,000, up from $182,000 this year.
Want To Save More?
If you need help paying for the things that Medicare doesn’t cover, you have the option of purchasing a Medicare Supplement Plan. Your plan can help pay for the things that Medicare does not, including the 20% coinsurance that you will have to pay out-of-pocket for every Part B expense. One of these plans could cover 100% of your Part A coinsurance and hospital costs, as well as 100% of Part B coinsurance and copayments, for one low monthly premium price.
There are 10 different Medicare Supplement Plans to choose from, each offering different coverage options and rates. It’s worth looking into a Medicare Supplement Plan to save as much money as you can, so speak to an EZ agent for all of your options. EZ’s agents work with the top-rated insurance companies in the nation and can compare plans in minutes for you at no cost. To get free instant quotes for plans that cover your current doctors, simply enter your zip code in the bar on the side, or to speak to a licensed agent, call 888-753-7207.
Insurance costs can surprise you, and purchasing policies for your company can run into stormy waters. With a good understanding of the costs and ways to save money, you can sail your company’s ship straight to profitable seas. Insurance costs, or those “life happens” moments, crop up when you least expect them. Proper planning will alleviate the strain these cause. The average company spends about $1300 on policies, but plan prices are increasing steadily for years. Don’t let unknown factors cost you capital.
The information n insurance costs can really stack up. We’ve got these easy outlines for you to follow.
When it comes to insurance for your business, certain forms of coverages are mandatory like Worker’s Compensation, but you should be aware of what will raise your costs, and where are the places you can save money.
Cost-Raising Factors
Different things influence your final price. Learn them now:
History of claims – Your company’s past will be brought up at some point from the insurance perspective. If you have past claims, make sure you are up to date on them and still have their information.
Profit Margin – Your final sales numbers will be taken into account. These directly affect how much coverage you need plus your ability to afford it. If you have a high-profit margin, you’ll want to protect your interests.
Physical Property – If you have a physical site with assets, this will directly affect your Business Owner’s Policy. Remember, a larger building will require more coverage.
Physical Location – Different states have different insurance laws, and some have scarier premiums. Your physical location will be a big determining factor across the board.
Employee Number – Whether you’re self-employed or have a staff, this number dictates when and why you need coverages like Group Health insurance.
Technology can help out too. There’s an app pretty much everything out there.
Of course, take your business’s specific needs into account, but those vary widely based on industry. Your insurance liaison (known as an actuary) will calculate your risks before offering you different options and their price. Now, how can you reduce these costs?
Places to Save Money
Here is the good news. There are many ways for you as a business owner to cut your expenses. Take these three factors into account:
Deductibles – When tax season comes about, this is the best time to minimize the payment you are expected to make. Write everything down during the year, including claim payments, so that they count toward a lower final number. Remember, business expenses count towards a tax refund.
Bundling – Grouping things like policies together can save time and money. Often, an insurance company will offer a better deal if you’re willing to only purchase your policies with them. Consider your options when doing this, because it’s a lot less stressful to only look in one place for your information.
Refreshing your info – New updates happen in the insurance industry all the time, and your business should also be constantly evolving. If you set one price down for yourself, you may lose out on a better option later. If nothing else, calling your provider and updating your company’s information may give them a better perspective on how they can help you in the future. New coverage may arise that they didn’t know they could offer you.
Coverage comes with responsibility. As a business owner, it’s your job to make the best choices to grow. Your employees and customers are counting on you. With these factors in mind, you can look into where to best allocate your assets. However, everyone can use a helping hand, especially when the industry is as complicated as insurance.
Keeping track of everything can be exhausting. Make sure to keep accurate documentation and get help when you need it.
EZ.Insure is ready to be that helping hand. Your agent will answer any questions you have, compare the plans for you, and even sign you up, free of charge. To get started simply enter your zip code in the bar above, or you can speak to an agent by emailing [email protected] or calling 888-998-2027. EZ.Insure makes the entire process easy, and quick.
