Health Insurance

Health Insurance

The cost of medical care and the rising cost of health insurance premiums continue to make your health insurance options a #1 priority when considering your health insurance choices.  The information below may help answer some of your questions about health insurance so you can make an intelligent choice at the most reasonable price.

Here is a brief description of the types of available health insurance plans: Managed Care Options,  Government sponsored Options and Tax Savings Options.

A. Managed Care Options

Preferred Provider Organizations (PPO) is a type of health insurance arrangement that allows you relative freedom to choose the doctors and hospitals of your choice. The participating doctors, hospitals and health care providers are paid by the insurer on a negotiated, discounted fee schedule. Costs are lower if you use in-network healthcare services, but you have the option of going out-of-network. If you choose an out-of-network provider, you are generally required to pay the difference between what the provider charges and what the plan pays and your deductible and out-of-pocket exposure will be greater.

Health Maintenance Organizations (HMOs) offer access to an extensive network of participating physicians, hospitals and other health care professionals and facilities. You choose a primary care doctor from a list provided by the HMO and this doctor coordinates your health care. You must contact your primary care doctor to be referred to a specialist. Generally, you pay fewer out-of-pocket expenses with an HMO, but you are often charged a fee or co-payment for services such as doctor visits or prescriptions.

Short Term Major Medical (STM) plans offer you coverage in between jobs. These plans are not recognized by the Government as a minimum essential benefit and therefore, you will be subject to a tax penalty. Short-term plans do not cover prescriptions or any pre-existing conditions.

STM insurance is designed to give someone health insurance/medical coverage for catastrophic events for a short period of time. Some companies impose limits on purchasing a new policy at the end of our first three months of coverage. It is not uncommon for an insurance carrier to give someone a one-time “renewal” of the policy, purchasing up to another 3 months at the end of the first policy termination. Technically, you are not really renewing the policy, but instead starting over and buying a new policy with a new deductible and new benefit limits.

All STM plans are NOT ACA compliant and do not meeting the requirements of the healthcare law. So if you have a Short Term Insurance policy for more than 60 days, you will be subject to the tax penalty under the ACA law.

Because Short Term Medical Insurance policies are not ACA compliant, they do not cover Pre-existing Conditions at all or Preventative benefits for “free,” and they are not guaranteed to be issued. This means that the insurance carrier can ask you medical questions (although most only have 3-5 questions that you must answer No to in order to get coverage.) If you say YES to a medical condition,  ie. Diabetes, cancer in the last 5 years, currently pregnant, or exceed a certain height/weight limit, you can be declined for coverage.

Medicare Supplement Plans

You’re 65 and you qualify for Medicare insurance coverage in Illinois.  Now you need to complete your protection by purchasing the right Medicare supplement in Illinois to cover all the items that Medicare won’t.

Medicare by itself is not enough! There are deductibles for Medicare A or B insurance, and the 20% coinsurance on Part B is unlimited!  So, if you have a large claim, such as going through chemo and radiation for cancer, you will pay 20% of ALL of Part B (outpatient services). With an Illinois Medicare Supplemental policy, you can fill in your coverage so that you are fully protected.  Most Illinois Medicare Supplement plans pay the Part A and Part B deductibles as well as the 20% coinsurance, which leaves you with ZERO out of pocket costs.

Worried about the costs? You shouldn’t be.  Medicare Supplemental insurance is extremely common and competitive so that the price is inexpensive compared to the benefits it provides. Many plans pick up the entire cost leaving you with ZERO out of pocket costs for all hospital, surgical and physician services.

With Medicare Supplement insurance in Illinois, you can choose your own doctor and to let your medical needs dictate the treatment you get.

Government-sponsored Health Insurance

Medicaid is a federal/state public assistance program created in 1965. It is administered by the states for people whose income and resources are insufficient to pay for health care or private insurance. All states have Medicaid programs, though eligibility levels and coverage benefits vary.

Medicare is a federal government program for people 65 and older, or those with certain disabilities, that pays part of the costs associated with hospitalization, surgery, doctors’ bills, home health care and skilled-nursing care.

Medicare RX–Plan D is the government program for people over 65 to help with the cost of prescriptions.

State Children’s Health Insurance Program (SCHIP) is administered at the state level and provides health care to low-income children whose parents do not qualify for Medicaid. SCHIP may be known by different names in different states.

FamilyCare offers healthcare coverage to parents living with their children 18 years old or younger.
FamilyCare also covers relatives who are caring for children in place of their parents.

Military Health Care includes TRICARE/CHAMPUS (Civilian Health and Medical Program of the Uniformed Services) and CHAMPVA (Civilian Health and Medical Program of the Department of Veterans Affairs) as well as care provided by the Department of Veterans Affairs (VA).

State-specific Plans are available for low-income uninsured individuals. These plans are known by different names in different states.

Indian Health Service (IHS) is a Department of Health and Human Services program offering medical assistance to eligible American Indians at HIS facilities. In addition, the HIS helps pay the cost of selected health care services provided at non-HIS facilities.

Tax Savings

Cafeteria/Flexible Spending Plans are employer-sponsored plans that allow the employee to design his or her own employee benefit package, choosing between one or more employee benefits and cash. Several types of Flexible Benefits or Cafeteria Plans are used by employers, including a pre-tax conversion plan, multiple option pre-tax conversion plan, medical plans plus flexible spending accounts, and employer credit cafeteria plans. For more information about these choices, contact your employee benefits department.

Health Savings Account (HSA) is a savings product designed to offer individuals a different way to pay for their health care. HSAs enable you to pay for current health expenses and save for future qualified medical and retiree health expenses on a tax-free basis. You establish a tax-free savings account that covers your out-of-pocket medical expenses. This means that you own and control the money in your HSA. You make all decisions about how to spend the money without relying on a third party or a health insurer. You cannot use your H.S.A. to pay your premiums.  It can only be used for out of pocket expenses, i.e. dental, vision, copays, deductibles, etc.  You can also decide what types of investments to make with the money in the account in order to make it grow. However, in order to sign up for an HSA, you are required to be enrolled in a High Deductible Health Plan that is H.S.A. compatible.

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