Buyer's Guide For California Health Insurance

Introduction
Making Sense of Health Insurance in California
Fee-for-Service
Managed Care
Appropriate Care
How Do I Get Health Coverage?
Pre-existing Conditions
What Is Not Covered?
What Happens to My Insurance if I Lose
Frequently Asked Questions
Comparing Plans
Costs
Medicare Supplemental & Long-Term Care Insurance
A Final Word

Buyer's Guide Page 2

Fee-for-Service

This type of coverage generally assumes that the medical provider (usually a doctor or hospital) will be paid a fee for each service rendered to the patient-you or a family member covered under your policy. With fee-for-service insurance, you go to the doctor of your choice and you, or your doctor, or hospital submits a claim to your insurance company for reimbursement. You will only receive reimbursement for "covered" medical expenses, the ones listed in your benefits summary.

When a service is covered under your policy, you can expect to be reimbursed for some, but generally not all, of the cost. How much you will receive depends on the provisions of the policy on coinsurance and deductibles. Here's how it works:

Managed Care

The three major types of managed care plans are Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPOs), and Point-Of-Service (POS) plans.

Managed care plans generally provide comprehensive health services to their members, and offer financial incentives for patients to use the providers who belong to the plan. In managed care plans, instead of paying separately for each service that you receive, your coverage is paid in advance. This is called prepaid care.

For example, you may decide to join a local HMO where you pay a monthly or quarterly premium. That premium is the same whether you use the plan's services or not. The plan may charge a copayment for certain services-for example, $10 for an office visit, or $5 for every prescription. So, if you join this HMO, you may find that you have few out-of-pocket expenses for medical care-as long as you use doctors or hospitals that participate in or are part of the HMO. Your share may be only the small copayments; generally, you will not have deductibles or coinsurance.

Some HMOs, like Kaiser, deliver care directly to patients.  Patients sometimes go to a medical facility to see the nurses and doctors or to a specific doctor's office. Here the HMO employs the doctors and nurses and the HMO owns the hospital and medical facilities.  Another common model is a network of individual practitioners. In these Individual Practice Associations (IPAs), you will get your care in a local physician's office.

If you belong to an HMO, typically you must receive your medical care through the plan. Generally, you will select a primary care physician who coordinates your care. Primary care physicians may be family practice doctors, internists, pediatricians, or other types of doctors. The primary care physician is responsible for referring you to specialists when needed. Except in unusual circumstances, the specialists are part of the medical group of your primary care physician.

PPOs and POS plans are categorized as managed care plans. (Indeed, many people call POS plans "an HMO with a PPO option.") From the consumer's point of view, these plans combine features of fee-for-service and HMOs. They offer more flexibility than HMOs, but premiums are likely to be somewhat higher than HMOs.

With a PPO or a POS plan, unlike most HMOs, you will get some reimbursement if you receive a covered service from a provider who is not in the plan. Of course, choosing a provider outside the plan's network will cost you more than choosing a provider in the network. These plans will act like fee-for-service plans and charge you coinsurance when you go outside the network.

What is the difference between a PPO and a POS plan? A POS plan has primary care physicians (like in an HMO) who coordinate patient care; and in most cases, PPO plans do not. Some POS plans allow patients to by-pass the primary care physician and seek care directly from a PPO or non-network doctors.  But there are exceptions!

HMOs and PPOs have contracts with doctors, hospitals, and other providers. They have negotiated certain fees with these providers-and, as long as you get your care from these providers, they should not ask you for additional payment. (Of course, if your plan requires a copayment at the time you receive care, you will have to pay that.)

Always look carefully at the description of the plans you are considering for the conditions of payment.

Appropriate Care

HMOs, PPOs, and fee-for-service plans often share certain features, including pre authorization, utilization review, and discharge planning.

For example, you may be asked to get authorization from your plan or insurer before admission to a hospital for certain types of surgery. Utilization review is the process by which a plan determines whether a specific medical or surgical service is appropriate and/or medically necessary. Discharge planning is an approach that facilitates the transfer of a patient to amore cost-effective facility if the patient no longer needs to stay in the hospital. For example, if, following surgery, you no longer need hospitalization but cannot be cared for at home, you may be transferred to a skilled nursing facility.

Almost all fee-for-service plans apply managed care techniques to contain costs and guarantee appropriate care; and an increasing number of managed care plans contain fee-for-service elements. While the distinctions among plans are growing increasingly blurred, the number of options available to consumers increases every day.

How Do I Get Health Coverage?

BenefitsCafe.com  makes getting affordable health insurance in California easy.  You can easily compare insurance companies, plan benefits and provider networks of doctors and hospitals.  At BenefitsCafe.com makes applying for health insurance easy by allowing you to either apply directly online or print and application and mail it in.  Individual insurance is a good option if you work for a company that does not offer health insurance, or if you are a part-time or contract employee and you do not qualify for the group health insurance plan.  Individual health insurance is also a solution if: you are self-employed; if your dependent spouse and/or children need coverage; you are between jobs; or, you want an alternative to the high cost of COBRA continuation coverage. Buying individual insurance allows you to tailor a plan to fit your needs from the insurance company of your choice. It requires careful shopping, because coverage and costs vary from company to company. In evaluating policies, consider what medical services are covered, what benefits are paid, and how much you must pay in deductibles and coinsurance. You may keep premiums down by accepting a higher deductible.

Health insurance is generally available through groups and to individuals. Premiums-the regular fees that you pay for health insurance coverage-are generally lower for group coverage. When you receive group insurance at work, the premium usually is paid through your employer.

Group insurance is typically offered through employers, although unions and professional associations also offer it. As an employee benefit, group health insurance has many advantages. Much-although not all-of the cost may be borne by the employer. Premium costs are frequently lower because economies of scale in large groups make administration less expensive. With group insurance, if you enroll when you first become eligible for coverage, you generally will not be asked for evidence that you are insurable. (Enrollment usually occurs when you first take a job, and/or during a specified period each year, which is called open enrollment.) Some employers offer employees a choice of fee-for-service and managed care plans. In addition, some group plans offer dental insurance as well as medical.

Pre-existing Conditions

Many people worry about coverage for preexisting conditions, especially when they change jobs. The Health Insurance Portability and Accountability Act (HIPAA) helps assure continued health insurance coverage for employees and their dependents. Starting July 1, 1997, insurers could impose only one 12-month waiting period for any preexisting condition treated or diagnosed in the previous six months. Your prior health insurance coverage will be credited toward the preexisting condition exclusion period as long as you have maintained continuous coverage without a break of more than 62 days. Pregnancy is not considered a preexisting condition, and newborns and adopted children who are covered within 30 days are not subject to the 12-monthwaiting period.

If you have had group health coverage for two years, and you switch jobs and go to another plan, that new health plan cannot impose another preexisting condition exclusion period. If, for example, you have had prior coverage of only eight months, you may be subject to a four-month, preexisting condition exclusion period when you switch jobs. If you've never been covered by an employer's group plan, and you get a job that offers such coverage, you may be subject to a 12-month, preexisting condition waiting period.

Federal law also makes it easier for you to get individual insurance under certain situations, including if you have left a job where you had group health insurance, or had another plan for more than 18 months without a break of more than 62 days.

If you have not been covered under a group plan and have found it difficult to get insurance on your own because you have a pre-existing medical condition, check with the experts at www.BenefitsCafe.com. They can help you enroll in a HIPAA policy or in the State of California's Major Risk Medical Insurance Plan (MRMIP), which is California's high risk health insurance pool. Similar to risk pools for automobile insurance, MRMIP can provide health insurance for people who cannot get it elsewhere.

What Is Not Covered?

While HMO benefits are generally more comprehensive than those of traditional fee-for-service plans, no health plan will cover every medical expense.

Very few plans cover eyeglasses and hearing aids because these are considered budgetable expenses. Very few cover elective cosmetic surgery, except to correct damage caused by a covered accidental injury. Some fee-for-service plans do not cover checkups. Procedures that are considered experimental may not be covered either. And some plans cover complications arising from pregnancy, but do not cover normal pregnancy or childbirth.

Health insurance policies frequently exclude coverage for preexisting conditions, but, as explained, federal law now limits exclusions based on such conditions.

You should also remember that insurers will not pay duplicate benefits. You and your spouse may each be covered under a health insurance plan at work but, under what is called a "coordination of benefits" provision, the total you can receive under both plans for a covered medical expense cannot exceed 100 percent of the allowable cost. Also note that if neither of your plans covers 100 percent of your expenses, you will only be covered for the percentage of coverage (for example, 80 percent) that your primary plan covers. This provision benefits everyone in the long run because it helps to keep costs down.

What Happens to My Insurance if I Lose My Job?

If you have had health coverage as an employee benefit and you leave your job, voluntarily or otherwise, one of your first concerns will be maintaining protection against the costs of health care. You can do this in one of several ways:

Frequently Asked Questions about California Health Insurance

Q.  What is the first thing I should know about buying health coverage?

A.  Your aim should be to insure yourself and your family against the most serious and financially disastrous losses that can result from an illness or accident. If you are offered health benefits at work, carefully review the plans' literature to make sure the one you select fits your needs. If you purchase individual coverage, buy a policy that will cover major expenses and pay them to the highest maximum level. Save money on premiums, if necessary, by taking large deductibles and paying smaller costs out-of-pocket.

Q.  Can I buy a single health insurance policy that will provide all the benefits I'm likely to need?

A.  No. Although you can select a plan or buy a policy that should cover most medical, hospital, surgical, and pharmaceutical bills, no single policy covers everything. Moreover, you may want to consider additional single-purpose policies like long-term care or disability income insurance. If you are over 65, you may want a Medicare supplement policy to fill in the gaps in Medicare coverage.

Q.  I'm planning to keep working after age 65. Will I be covered by Medicare or by my company's health insurance?

A.  If you work for a company with 20 or more employees, your employer must offer you (through age 69) the same health insurance coverage offered to younger employees. After you reach age 65, you may choose between Medicare and your company's plan as your primary insurer. If you elect to remain in the company plan, it will pay first-for all benefits covered under the plan-before Medicare is billed. In most instances, it is to your advantage to accept continued employer coverage.

But be sure to enroll in Medicare Part A, which covers hospitalization and can supplement your group coverage at no additional cost to you. You can save on Medicare premiums by not enrolling in Medicare Part B until you finally retire. Bear in mind, though, that delayed enrollment is more expensive and entails a waiting period for coverage.

Q.  I've had a serious health condition that appears to be stabilized. Can I buy individual health coverage?

A.  Depending on what your condition is and when it was diagnosed and treated, you can probably buy health coverage. However, the insurer may:

. provide full protection but with a higher premium, as might be the case with a chronic disease, such as diabetes;

Q.  One of my medical bills was turned down by the insurance company (or health plan). Is there anything I can do?

A.  Ask the insurance company why the claim was rejected. If the answer is that the service isn't covered under your policy, and you're sure that it is covered, check to see that the provider entered the correct diagnosis or procedure code on the insurance claim form. Also check that your deductible was correctly calculated.  If you purchased you policy through www.BenefitsCafe.com you can simply telephone them.  Explain the problem and fax any relevant paper work and they will work on your behalf to solve the problem.

Make sure that you didn't skip an essential step under your plan, such as pre admission certification. If everything is in order, ask the insurer to review the claim.

Comparing Plans

Whether you end up choosing a fee-for-service plan or a form of managed care, you must examine a benefits summary or an outline of coverage-the description of policy benefits, exclusions, and provisions that makes it easier to understand a particular policy and compare it with others.

Look at this information closely. Think about your personal situation. After all, you may not mind that pregnancy is not covered, but you may want coverage for psychological counseling. Do you want coverage for your whole family or just yourself? Are you concerned with preventive care and checkups? Or would you be comfortable in a managed care setting that might restrict your choice somewhat but give you broad coverage and convenience? These are questions that only you can answer.

Here are some of the things to look at when choosing and comparing health insurance plans.

Health Insurance Checklist

Covered medical services:

Are there any medical service limits, exclusions, or preexisting conditions that will affect you or your family?

What types of utilization review, pre authorization, or certification procedures are included?

If this is too much compare, try comparing just four plan features:

1)  Doctor's office visit charge;
2)  Deductibles that apply to hospital or doctor services;
3)  Your annual maximum payment, often called the "stop-loss," which is the most you would pay in any year for medical treatment;
4)  Prescription medicine charges for generic, brand and "non-formulary" medicine, which are medicines not on the insurance company's approved list.

Costs

Medicare Supplemental & Long-Term Care Insurance

Medicare supplement insurance, sometimes called Medigap or MedSup, is private insurance that helps cover some of the gaps in Medicare coverage.

Medicare is the federal program of hospital and medical insurance primarily for people age 65 and over who are not covered by an employer's plan. But Medicare doesn't cover all medical expenses. That's where MedSup comes in.

All Medicare supplement policies must cover certain expenses, such as the daily coinsurance amount for hospitalization and 90 percent of the hospital charges that otherwise would have been paid by Medicare, after Medicare is exhausted. Some policies may offer additional benefits, such as coverage for preventive medical care, prescription drugs, or at-home recovery.

There are 10 standard Medicare supplement policies, designated by the letters A through J. With these standardized policies, it is much easier to compare the costs of policies issued by different insurers. While all10 standard policies may not be available to you, Plan A must be made available to Medicare recipients everywhere.

Insurers are not permitted to sell policies that duplicate benefits you already receive under Medicare or other policies. If you decide to replace an existing Medicare supplement policy-and you should do so only after careful evaluation-you must sign a statement that you intend to replace your current policy and that you will not keep both policies in force.

People who are 65 or older can buy Medicare supplement insurance without having to worry about being rejected for existing medical problems, so long as they apply within six months after enrolling in Medicare.

Long-term care policies cover the medical care, nursing care, and other assistance you might need if you ever have a chronic illness or disability that leaves you unable to care for yourself for an extended period of time. These services generally are not covered by other health insurance. You may receive long-term care in a nursing home or in your own home.

Long-term care can be very expensive. On average, a year in a nursing home costs about $40,000. In some regions, it may cost much more. Home care is less expensive, but it still adds up. (Home care can include part-time skilled nursing care, speech therapy, physical or occupational therapy, home health aides, and homemakers.)

Bringing an aide into your home just three times a week-to help with dressing, bathing, preparing meals, and similar chores-easily can cost$1,000 a month, or $12,000 a year. Add in the cost of skilled help, such as physical therapy, and the costs can be much greater.

Most long-term care policies pay a fixed dollar amount, typically from$40 to more than $200 a day, for each day you receive covered care in a nursing home. The daily benefit for at-home care is usually half the benefit for nursing home care. Because the per-day benefit you buy today may be inadequate to cover higher costs in the future, most policies also offer an inflation adjustment feature.

Keep in mind that unless you have a long-term care policy, you are not covered for long-term care expenses under Medicare and most other types of insurance. Recent changes in federal law may allow you to take certain income tax deductions for some long-term care expenses and insurance premiums.

A Final Word about Health Insurance in California

If you get health care coverage at work, or a union, you are almost certainly enrolled under a group contract. Generally, the contract is between the group and the insurer, and your employer has done comparison shopping before offering the plan to the employees. Nevertheless, while some employers only offer one plan, some offer more than one. Compare plans carefully!

If you are buying individual insurance, or any form of insurance that you purchase directly, read and compare the policies you are considering before you buy one, and make sure you understand all of the provisions. Marketing or sales literature is no substitute for the actual policy. Read the policy itself before you buy.

Ask for a summary of each policy's benefits or an outline of coverage. Good agents and good insurance companies want you to know what you are buying. Don't be afraid to ask the insurance experts at BenefitsCafe.com to explain anything that is unclear.

It is also a good idea to ask for the insurance company's rating. The A.M. Best Company, Standard & Poor's Corporation, and Moody's all rate insurance companies after analyzing their financial records. The experts at BenefitsCafe.com can help you find these ratings.

And bear in mind: In some cases, even after you buy a policy, if you find that it doesn't meet your needs, you may have 30 days to return the policy and get your money back. This is called the "free look."  Also, when you purchase affordable California health insurance through www.BenefitsCafe.com