What is a deductible and how does it work?

Typically, a deductible is the amount of money you must pay each year before your health insurance plan starts to pay for covered medical expenses. After this deductible is met, the insurance company will pay a percentage of the bill, this is called the coinsurance.

What is coinsurance?

Coinsurance is cost-sharing where you are responsible for paying a certain percentage for a covered medical expense and the insurance company will pay the remaining percentage of the covered medical expenses after your deductible is satisfied. For a health insurance plan with 20% coinsurance, once the deductible is met, the insurance company will pay 80% of the covered expenses while you pay the remaining 20% until your out-of-pocket limit is reached for the year. Typically, the out-of-pocket limit is the maximum amount you will pay out of your own pocket for covered medical expenses in a given year.

What are co-pays?

A co-payment or co-pay is a specific amount you pay for each medical service, such as $30 for an office visit, after which the insurance company often pays the remainder of the affiliated charges.

Do I have to meet my deductible before insurance will pay when I see my doctor? With some health insurance policies the answer is YES, but many health insurance plans do not require this. Companies today offer plans where the deductible may only apply while hospitalized or for more major procedures. Many plans allow you to visit doctors and specialists, and fill prescriptions, with just a co-pay.

What is “out-of-pocket maximum?”

This is the amount of money one would pay out of their own pocket towards their medical expenses in any given year. An out-of-pocket expense may refer to how much the co-payment, coinsurance, or deductible is added together. Also, when the term annual out-of-pocket maximum is used, that is generally referring to how much the insured would have to pay for the whole year out of their pocket, excluding premiums.

What is a network?

A network is a list of doctors, hospitals and other providers who have contracted, or agreed, with an insurance company to do business with the insurance company. The providers fees have been negotiated, which means that the insurance company will not necessarily pay the doctor or hospital what your actual medical bills are, but will pay a lower amount. If you have a health insurance plan that utilizes a network and you use providers who are not part of the network, the amount of money that you would have to pay for those services will be considerably higher than if you use providers who are in the network.

What’s the difference between a Primary Care Physician (PCP) and a specialist?

A Primary Care Physician, or PCP, is the doctor you would go to on a regular basis, like when you’re simply not feeling well. A specialist is a doctor that your PCP might refer you to if the problem you have requires a doctor with more expertise in a certain area.

What is a pre-existing condition?

A pre-existing condition is any health condition you have or have had prior to applying for a policy.

Will a pre-existing condition prevent me from obtaining health insurance?

No. Under current law, health insurance companies can’t refuse to cover you or charge you more just because you have a “pre-existing condition” — that is, a health problem you had before the date that new health coverage starts. These rules went into effect for plan years beginning on or after January 1, 2014.

This means that health insurers can no longer charge more or deny coverage to you or your child because of a pre-existing health condition like asthma, diabetes, or cancer. They cannot limit benefits for that condition either. Once you have insurance, they can’t refuse to cover treatment for your pre-existing condition.

There is one exception. The pre-existing coverage rule does not apply to “grandfathered” individual health insurance policies. A grandfathered individual health insurance policy is a policy that you bought for yourself or your family on or before March 23, 2010 that has not been changed in certain specific ways that reduce benefits or increase costs to consumers.

What if I’m currently pregnant?

Maternity care and childbirth — services provided before and after your child is born — are essential health benefits. This means all qualified health plans must cover them. In the past, insurance companies could turn you down if you applied for coverage while you were pregnant. At that time, many health plans considered pregnancy a pre-existing condition.

Today insurance companies cam no longer deny you coverage if you are pregnant. You get this coverage even if you were pregnant before your coverage starts. Under the health care law pre-existing conditions are covered, including pregnancy. That’s true whether you get insurance through your employer or buy it on your own. What’s more, health plans cannot charge you more to have a policy because you are pregnant. An insurance company can’t increase your premium based on your sex or health condition.

However, some grandfathered individual health plans — the kind you buy yourself, not the kind you get through a job — aren’t required to cover pregnancy and childbirth. If you have a grandfathered individual plan, contact your insurance company to learn about your pregnancy and childbirth coverage.

What is an HMO?

A health maintenance organization (HMO) provides a form of health insurance coverage that is provided by hospitals, doctors, and other providers with whom the HMO has a contract. Providers contract with an HMO to receive more patients and in return usually agree to charge less for their services. When you choose to become insured under an HMO plan, you must choose a PCP (who is contracted by the insurance company) and see that doctor for all of your health issues. If you end up needing to see a specialist, you’ll see your PCP first and get a referral to see the specialist.

What is a PPO?

A Preferred Provider Organization is another form of managed care. A PPO negotiates arrangements with doctors, hospitals and other providers who accept lower fees from the insurer for their services. As a result, your cost-sharing will be lower if you use the network of providers.

One characteristic of PPOs is the ability to make self-referrals. PPO plan members can refer themselves to doctors of their choice, including specialists, as long as those providers are also part of your PPO network. With a PPO plan, you are allowed to see providers who are not members of the network, your insurance company will only pay part of those charges, leaving you to pay the balance.

What is the main difference between an HMO and a PPO?

Most HMOs require you to select a specific doctor as your primary care physician, or PCP. This doctor is your first point of contact for most medical conditions, exceptions are made for emergencies. Your choice of specialists and hospitals is usually limited to those already under contract with the HMO, and your primary care physician is the one who generally decides whether or not a referral to a specialist is necessary.

PPOs combine some of the characteristics of HMOs with the flexibility of traditional indemnity plans. PPOs offer a specific set of doctors and hospitals that you may choose from to get discounted rates. These are called “preferred” or “in-network” providers. PPO members are free to see any in-network provider at any time. Members may also see doctors who are not in the network, but the payment for those doctors will be higher.

What is Medigap Insurance (a.k.a. Medicare Supplement)?

At age 65 years of age, every American citizen has the option to enroll in Medicare (they may also qualify before the age of 65 if they are eligible for disability benefits). Basic Medicare includes Parts A and B and covers most of your basic hospital and doctor expenses, respectively. However, most” does not mean all. The expenses which Medicare does not cover – referred to as gaps in coverage – are covered by Medigap insurance products. Medgap insurance products are private plans designed to cover the medical expenses where traditional Medicare falls short.

Who is Eligible for Medigap Insurance?

If any of the following scenarios apply to you, then you are guaranteed eligible to purchase Medicare supplemental insurance:

  • You are currently covered under Medicare Parts A & B
  • You are within 6 months of turning 65
  • You are within 6 months of receiving Part B coverage
  • If you are about to lose your group health insurance plan

Please note that you may still be required to answer some medical questions about your overall health and wellness.

When Can I Sign Up for Medigap Insurance?

Many seniors believe that signing up for Medgap is complicated. The good news is that you can sign up for Medigap insurance at any time. However, there are some sweet spot time frames which, if you apply during those opportunities, will make the process much easier:

  • The Initial Enrollment Period. During your first 6 months of Part B coverage, your acceptance is guaranteed, regardless of your current level of health
  • The Guaranteed Issue Period. If you are on the verge of losing coverage through an employer, you will have a “guaranteed issue” period lasting 63 days where you can purchase any Medigap policy with no health questions asked.

If you apply for Medicare supplement at any point outside of these time frames, you will likely have to go through a more complicated process of medical underwriting and answering a number of invasive health related questions.

Who Purchases Medigap Insurance?

It doesn’t matter whether you’re struggling to get by, on a fixed income, or enjoying incredible wealth in your golden years. All seniors from all walks of life can benefit from a Medicare supplement insurance policy. Medicare provides standard coverage to every beneficiary, regardless of income. What it does not provide, however, is 100% coverage of your medical costs. Therefore, the more vulnerable you are to the gaps in Medicare coverage, the more you can benefit from the protection of a Medigap policy.

Where Do I Purchase Medigap Insurance?

As a consumer you have a variety of options. While some prefer to look up nearby, local, agents, many people research the options online. At Sunvalley Insurance a team of licensed and experienced agents  help you get more and better offers from several major companies who are all competing for your business. We help you compare multiple plans, prices, and insurance companies by filling out our one, simple online quote form. We can help you get the best possible deal on virtually any available Medigap policy.

Do you have customer service?

Of course! Our friendly and knowledgeable customer services reps are available to answer your questions 24/7/365.

Next Steps…

For more information contact us today and ask for your free no-obligation quote.We will help you explore a variety of insurance options and discounts. Call us at +1 800 645 0297 or email us. Alternatively, have an insurance-licensed Sunvalley Insurance representative contact you.