Group Health Insurance
Health care reform
Health Savings Accounts (HSAs)
Individual Health Insurance
Long Term Care Insurance
Medicare related coverage
06-04-2009by Colleen King
It’s getting to be that time of year when the four years of college (or five, or six) is about to wind up. At last. That tuition bill is going to be gone and the kid(s) will be out of the house. Then it occurs to mom and dad (not usually to the new grad) that their young adult can’t stay on their insurance policy any longer.
Carriers allow full time college students to stay on their parents’ coverage until age 23, 24, or even 25. As the hassle with pre-existing conditions continues to increase, some carriers are talking about increasing the age a kid can stay on their parents’ policy, even if they aren’t in college. But we aren’t quite there yet.
This little detail can easily escape everyone since finals and planning for graduation are a lot more interesting. I had this situation come up last year with a family, and there are a couple ways to do it. It was a Friday, college graduation was Saturday, the new grad was turning 24 on Sunday so as of Sunday, she was going to be uninsured and Mom was panicking.
We could have done a regular policy, but since that usually takes 2-4 weeks, the young woman wouldn’t have been covered. Instead, we elected to do a short term health plan. These will vary from state to state, so what I’m relating here pertains specifically to California. These plans I refer to as ‘accident and illness’ policies. They don’t cover anything routine, they don’t cover pre-existing conditions or maternity, but if you get sick or have an injury you have coverage. And, because it doesn’t cover anything pre-existing the underwriting, or review of the application, is much quicker. We can usually get a response in a couple of days.
So the short term health plan was how we handled it. These can be kept on a month to month basis, up to a maximum of 6 months, and if you’ve not had any claims, you can renew it for up to another six months. These plans are also really useful in situations where you get a new job, you don’t have benefits for the first 90 days of employment and you don’t want to pay the exorbitant cost of COBRA. I’ve used these many times and while they aren’t ideal due to the fact that they are short term, they sure can be a great stop gap. And the carrier I use most, if you go to an emergency room for an injury, the deductible is waived. I wish all policies would do that!
So congratulations, and good luck to the class of 2009!
05-10-2009by Colleen King
A couple of months ago I did an article on COBRA coverage: how it works, and why you should or shouldn’t take it.
Now that there’s a subsidy of 65% for people involuntarily terminated after September 1, 2008, the picture changes somewhat. Depending on how much the 35% you have to pay is, that 65% can be pretty tough to turn down. But I still have a couple of caveats for you.
This only lasts 9 months. With any luck, during that time you will have another job, with benefits, and you don’t have to think about this any further. Normally when someone is offered COBRA I suggest they look at an individual plan if they are potentially insurable because anyone can have something develop or happen to them that could render them uninsurable.
I still think you have to give that serious consideration but I know that subsidy is REALLY tempting. Here is what I think you should consider. If buying the coverage is on your own is less than the 35% you’d need to pay, then look at individual plans. Whenever someone elects to take COBRA for a family, but not everyone needs to be on COBRA, meaning they are insurable, look at individual plans. Especially if you don’t qualify for the subsidy. You need to look at all options for your situation, which is why an independent agent in addition to your HR person at work is important.
If the cost issue with the subsidy is close, maybe the plan on your own is slightly more than your COBRA cost, consider getting your own coverage, again, just in case. It’s all a matter of what’s going to make things easiest for you to handle.
Be well!...read more
04-28-2009by Colleen King
It’s so nice to have people that keep you on your toes. Health Insurance questions abound when you ask for topics for this blog. Thanks to Lisa Nicole Bell again, www.adivinebook.com for this one.
The plus for you, the consumer, whether it’s for individual health insurance of group health insurance is that the rates are the rates. No one has special ‘deals’ to get you something better, it’s a matter of service. When you go directly to an insurance company, a carrier, they can only give you information on what they offer. And that’s fine, but if you want information on multiple carriers, you have to call each one. That also means you have multiple people following up with you trying to gain your business. If you have the time to do that, great. Some people would rather do it that way, so there’s no right or wrong.
But by going to an independent agent, which is what I am, you can talk to one person, for FREE, and get all the information on several carriers from an unbiased source, theoretically. Some agents are more partial to certain carriers, so you may even want to talk to a couple different agents to see who you are most comfortable with. But basically you can have one contact for multiple companies.
Agents are paid on a commission basis by the insurance carrier they place the business with. You can talk to one of us for hours, never do anything, and there is no charge to you. One of my group cases, I spoke with the contact for 2 1/2 years before they did anything. The situation was such that they didn’t need to start a group plan right away. But when they finally did, it absolutely was worth the wait. One of the two partners in this group has referred 3 family members to me because she liked working with me.
An even more important reason to have an independent agent is if there is an issue after the sale. Agents working for a carrier will certainly do all they can to help you if there’s an issue, usually. But, if an outside agent is pressing an issue, carrier reps (the people inside the company that an independent agent can call for problems) know you can move that business by next month if the client is really unhappy.
So again, there’s no exact answer because everyone will have different opinions. But if you have a good independent agent, you may end up doing less of the leg work yourself which many people prefer in this busy day and age.
Be Well!...read more
04-13-2009by Colleen King
Once of the best things about getting my insurance license was learning the difference between the two basic types of insurance, which had eluded me for years. Basically there are two types of life insurance and they break down to temporary and permanent.
Love this, this should be our ‘real’ security
An easy way to remember the difference, is ‘term is temporary’—Term life insurance is something you buy for a specific period of time, 10, 20, 30 years for example, and for a specific amount. At the end of that time period, if you are still around, that’s it; it’s gone. One ‘add on’ option is to buy what’s called a return of premium rider, so that and the end of the term, if you are still alive, all the premium you have paid is returned. Term is generally what you buy when you are younger, because financial demands are greater when raising your family, and term life insurance is more affordable.
“Permanent” types of life insurance basically are whole or universal life. Once you buy these policies, they are in force until you pass away or cancel them. People tend these days to lean more toward universal life versus whole life because the premiums are flexible; you aren’t always locked into a specific amount per month. The downside with permanent types of insurance is that these policies are more expensive, because they have to be in place for an unknown length of time. These policies also build a ‘cash value’ which can be used in a number of ways, including supplementing retirement income.
Most term policies are able to be converted to a permanent policy without proof of insurability, which helps out later in life. You can make it for a lower face value, so you can still take care of your loved ones needs without having to qualify for on a health basis. The main reason to have life insurance is to buy your surviving spouse time to grieve and deal with life without facing losing the home. It gives them time to figure out what they are going to do, and not having to make huge financial decisions at a time when they can’t think straight. And that’s what matters.
Be well!...read more
03-31-2009by Colleen King
A few weeks ago a delightful young woman asked me about health insurance, and what was good for a young professional or new grad, or people in general under 35. This answer is for you, Lisa Nicole Bell (http://wwwadivinebook.com). You really need to check her site out, she has a lot to offer in these crazy times.
Anyway, The answer to Lisa’s question could take a lot of space, but here goes. If you’re lucky enough to land a job out of school, or a job anytime that offers health insurance, you absolutely should sign up for them. Many times you only have one plan to choose from so that makes it easy. Other times you may have a choice between an HMO plan and a PPO plan. HMOs are good because even though they generally have smaller doctor networks, your financial outlay if you need care tends to be a lot less. AND, in group plans the HMOs usually cost less than PPOs so your contribution to the premium might be lower . With PPOs though, you have more doctors to chose from.
If you have to fend for yourself and get an individual health plan, which happens more and more these days, things change somewhat. In the last couple of years there have been a lot of individual plans that are really cost effective, but the reason they are is that they don’t cover maternity. This concerns me because even when young women aren’t planning on a baby anytime soon, things happen. Then, you can’t change plans to get maternity coverage because if you are pregnant, it’s an automatic decline when you apply. So I urge women in their 20s and 30s to have something with maternity just in case. But ultimately it’s their decision. There is one insurance carrier in California that will allow you to switch to their $5000 deductible plan that covers maternity, but wow.
I suggest when you are looking for an insurance plan that doesn’t cost a fortune that you consider one that does one or more of the following:
Offers a limited number of office visits per year for a fixed co-pay. You can still see a doctor, but the deductible then comes in to play. Since most younger people don’t see a doctor more than 1-2 times a year, this usually works.
Consider a plan that offers only generic prescription drug coverage. My preference is for everyone to have full coverage, just because I’m cautious, but many times you would be fine with just generic.
Consider a qualified high deductible health plan that you can use with a health savings account (HSA). These are definitely less expensive, and some offer maternity coverage. The thing you have to understand about these types of plans is that the only benefits you have prior to meeting the deductible are preventive. You pay for everything until you meet the deductible. BUT, when you have an eligible plan you can open an HSA, put money into that to save for future health care costs and the money deposited in the account is deductible on your federal tax return. And in some states too.
People often ask about ‘catastrophic’ plans. There isn’t really a clear definition on that, but these are generally considered to be the PPO plans with $5000 deductible or higher, maybe they have office visit coverage, maybe they have prescription drug coverage. There is also a set of plans that are hospitalization only, and those really scare me because that’s exactly what they are–hospitalization ONLY. No prescriptions, no office visits and usually no coverage for outpatient care which can be costly.
So to answer the question, what kind of coverage should people in their 20s and 30s get? Call an independent agent and discuss your situation. It’s a matter of what will fit in your budget, how extensive you want the coverage to be and your overall health situation. Calling an independent agent is really helpful because they can help you compare companies instead of you calling all of them. AND, their services are free to you. You will get the same rates whether you go to an outside agent or directly to the carrier. Just do something; medical costs aren’t dropping any time soon!
Be well!...read more