Frequently Asked Questions
- Why should I have health insurance?
The cost of health care has risen drastically over the past few decades. If you do not have medical insurance to help pay bills, a serious injury or illness can be financially devastating to you and your family. If you don’t have coverage you can be exposed to high health care bills; or if you have too little or the wrong kind of coverage, you won’t have enough protection.
The federal Affordable Care Act (ACA) also requires you to have a major medical insurance plan in place in 2014 or you may be subject to a federal tax penalty. For more information on the ACA, please see our Health Care Reform pages.
- What types of health insurance are available?
Major Medical Plans
This type of policy is usually effective in covering serious illness or injury where costs are high. Hospital care, drugs and doctors’ visits are usually covered. Most major medical plans in 2014 are required to include essential health benefits under the ACA. These benefits can be delivered in several different ways:
- Indemnity plans – These major medical plans typically have a deductible – the amount you pay before the insurance company begins paying benefits. After your covered expenses exceed the deductible amount, benefits usually are paid as a percentage of actual expenses. Plans issued under the ACA will pay benefits that range from 60 – 90 percent, depending on the plan you choose. These plans usually provide the most flexibility in choosing where to receive care.
- Preferred Provider Organization (PPO) plans – In these major medical plans the insurance company enters into contracts with selected hospitals and doctors to furnish services at a discounted rate. As a member of a PPO, you may be able to seek care from a doctor or hospital that is not a preferred provider, but you will probably have to pay a higher deductible or co-payment.
- Managed Care Organization (MCO) plans – These major medical plans usually require you to choose a primary care physician (PCP) from a list of network providers. Your PCP is responsible for managing all of your health care. If you need care from any network provider other than your PCP, you may have to get a referral from your PCP to see that provider. You must receive care from a network provider in order to have your claim paid through the MCO. Treatment received outside the network is usually not covered, or covered at a significantly reduced level.
- Point of Service (POS) plans – These major medical plans are a hybrid of the PPO and MCO models. They are more flexible than MCOs, but do require you to select a primary care physician (PCP). Like a PPO, you can go to an out-of-network provider and pay more of the cost. However, if the PCP refers you to an out-of-network doctor, the health plan will pay the additional cost.
Limited Benefit and Supplemental Plans
These types of policies provide limited coverage for a particular health setting, ailment or disease. These plans do not have the essential health benefits that are required for major medical plans under the ACA. Consider purchasing one of these plans after you have a major medical insurance plan in effect. Here are some of the options that may be available to you:
- Basic Hospital Expense Coverage – Covers a period of usually not less than 31 days of continuous in-hospital care and certain hospital outpatient services.
- Basic Medical-Surgical Expense Coverage – Covers costs associated with a medically necessary surgery, including a certain number of days (usually not less than 21 days) of in-hospital care.
- Hospital Confinement Indemnity Coverage – Covers a fixed amount (usually not less than $40) for each day that you are in a hospital. The benefits paid are not based on your actual expenses.
- Accident Only Coverage – Covers death, dismemberment, disability or hospital and medical care caused by an accident. You can also purchase specified accident coverage that covers only certain accidents.
- Specified Disease Coverage – Covers diagnosis and treatment of a specifically named disease or diseases, such as cancer.
- Other Limited Coverage – You can purchase insurance covering only dental or vision or other specified care.
Before you purchase a limited benefit or supplemental plan, please consider:
- Limited benefit or supplemental plans are not a substitute for comprehensive major medical coverage. Insurance coverage for all conditions is essential.
- Major medical policies provide for payment of a large percentage of eligible expenses after a deductible is paid. Once you have paid a predefined out-of-pocket maximum, the insurance company then will pay 100% of eligible expenses.
- You may not need extra coverage. Don’t assume double coverage will pay double benefits. Ask yourself these questions: Is my current coverage adequate for these costs? How likely is it I’ll have an accident or a specific disease where the amount of premium I pay over time is worth the limited benefits?
- Some limited benefit or supplemental plans pay only for hospital care. Many treatments, such as for cancer chemotherapy, are often given on an outpatient basis. Read the plan limitations and exclusions carefully.
- These policies will not cover conditions diagnosed or treated prior to your policy application. You may be subject to preexisting condition limitations. As of January 1, 2014, preexisting condition limitations are no longer allowed for major medical insurance under the ACA, but can still apply to limited benefit or supplemental plans.
- These policies will not cover related illnesses or complications. As an example, treatment of cancer may lead to other physical problems such as infection or pneumonia. Related problems or complications might not be covered. Read the plan limitations and exclusions carefully.
- Many policies have time or dollar limits. Some policies might have a waiting period of 30 days or more before benefits are payable. Other policies may stop paying benefits after a fixed period of time or a certain dollar limit.
Additional Coverage Options
Other types of policies provide added protection should you become disabled, require long-term care or enroll in Medicare:
- Disability Income – This coverage provides for weekly or monthly benefit payments while you are disabled after a covered injury or sickness. The disability payment is usually a set dollar amount not to exceed a certain percentage or your income. Your disability payments may be reduced by other income you receive, such as Social Security disability or retirement benefits. These policies usually expire when you become eligible for Medicare.
- Long-Term Care Insurance – This policy usually pays for skilled, intermediate and custodial care in a nursing home, and also for care in other settings, such as the home, adult day-care center or assisted living facility. The policy usually pays a fixed amount per day while the person is receiving care. For more information on long-term care insurance, contact our Senior Health Insurance Benefit Advisors Program (SHIBA) or call 800-247-4422. Also see our page regarding the Idaho Long-Term Care Insurance Partnerhip Program.
- Medicare Supplemental Coverage – The federal Medicare program pays most medical expenses for people age 65 or older, or for individuals under age 65 receiving Social Security disability benefits. However, Medicare does not pay all expenses. As a result, you may want to buy a Medicare Supplement policy that helps pay for certain expenses, including deductibles not covered by Medicare. For more information on Medicare and coverage options, contact our Senior Health Insurance Benefit Advisors Program (SHIBA) or call 800-247-4422.
These are NOT health insurance plans:
- Discount Plans – You may receive advertisements from plans offering discounts on health care for a monthly fee. These are not health insurance plans and participants do not have the same protections as under licensed health insurance plans. The Department of Insurance strongly recommends that you thoroughly investigate any plan promising deep discounts for a “low” monthly fee and weigh the benefits against the cost carefully.
- Non-Licensed Risk-Sharing Plans – You may receive offers to join a group or association that will take your monthly premiums, put them in a savings account (or trust) with other participants’ money, and then help pay some of your health care costs as needed. Such arrangements are not insurance, and the participants do not have the same protections as purchasers of licensed insurance plans. The Department of Insurance strongly recommends that you thoroughly investigate such plans before joining.
- What happens when my group health coverage ends?
You can apply for individual health coverage through agent or broker in the area where you live, or by contacting an insurance company offering individual major medical coverage in Idaho
- What happens to my group health coverage if I leave my employer?
You may be eligible for protection under the Consolidated Omnibus Budget Reconciliation Act (COBRA) and may be entitled to a minimum of 18 months of continuation coverage. You can find out more about COBRA continuation of group health benefits from the U.S. Department of Labor Office of Employee Benefits Security Administration website or call 866-444-3272.
If your employer has less than 20 employees, you might not be eligible for COBRA. Idaho does not have any other continuation of health coverage requirements if you are not eligible for COBRA. If you are moving to a new employer, you may have new group health coverage available through your new employer. Otherwise, apply for an individual health insurance plan as soon as possible so you have continuous protection.
- What is a “self-insured” plan?
An employer may choose to “self-insure” the employees’ health plan by paying out benefits from its own funds. Typically, an insurance company administers the program, but the liability for paying the care of the employees rests on the employer. Workers should understand that if their employer “self-insures,” state protections (such as access to internal and external appeal processes, assurance of certain benefits, and the right to have grievances heard by the Department of Insurance) do not apply. All federal protections (i.e., HIPAA and COBRA) do remain. You can find out more about self-insured plans from the U.S. Department of Labor Office of Employee Benefits Security Administration website or call 866-444-3272.
- Where can I go for help?
If you have questions about your policy, your rights and protections, or a potential agent or insurer, contact the Idaho Department of Insurance at 334-4250 in the Boise area, or 800-721-3272 toll-free statewide. You can also contact the Department for assistance if you have a grievance against a licensed health insurer or agent. You can file a written complaint against an insurer or agent here.
Was your question not listed here? Contact our Consumer Affairs section with your question.
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