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Some Frequently Asked Questions about Health Insurance...

Q: Are all policies alike?

A: No, there are a number of different policies and it is important to choose the one that is right for you.

Q: What is a Traditional Health Insurance policy?

A: A Traditional Health Insurance policy is also referred to as a Copay plan. It includes a Lower Deductible Major Medical coverage and incorporates a set Copay amount for doctor visits and prescription coverage, which does not apply toward the Major Medical deductible but, instead, applies to its own set Copay deductible amount. The insured pays a monthly premium for coverage (much the same way one would pay a monthly premium to insure their automobile). The insured patient must pay all medical bills up to the deductible amount each year before the insurance company begins to pay on any medical bills. Most bills paid by the patient, provided they are submitted as proper claims through the insurance company by the provider or the patient, are generally discounted by the insurance company by a small percent until the deductible is met. The balance paid by the patient is then applied toward the deductible amount. Once the deductible has been met, the insurance company will pay a percentage of the remaining medical bills for covered services for the rest of the year. The patient will pay the remaining percent. This percentage, called "co-insurance", is chosen, along with the "deductible" amount, by the patient at the time of purchase of the insurance.

Q: What is a PPO policy?

A: A PPO (Preferred Provider Organization) policy is also referred to as a Copay plan. It includes a Lower Deductible Major Medical coverage and incorporates a set Copay amount for doctor visits and prescription coverage, which does not apply toward the Major Medical deductible but, instead, applies to its own set Copay deductible amount. The insured pays a monthly premium for coverage (much the same way one would pay a monthly premium to insure their automobile). The insured patient must pay all medical bills up to the deductible amount each year before the insurance company begins to pay on any medical bills. Most bills paid by the patient, provided they are submitted as proper claims through the insurance company by the provider or the patient, are generally discounted by the insurance company by a small percent until the deductible is met. The balance paid by the patient is then applied toward the deductible amount. Once the deductible has been met, the insurance company will pay a percentage of the remaining medical bills for covered services for the rest of the year. The patient will pay the remaining percent. This percentage, called "co-insurance", is chosen, along with the "deductible" amount, by the patient at the time of purchase of the insurance.

Q: What is an HMO policy?

A: HMO - Health Maintenace Organization - Choosing an HMO usually means that you agree to use a specific team of health care professionals. In most cases you select one doctor, from a list of the members, who will serve as your Primary Care Physician. This physician now coordinates all of your health care, which means that he or she treats you directly and, when necessary, manages your referral to specialists. The only exceptions to first going to your Primary Care Physician is for visits to an OB/GYN or in an emergency. Some HMO's are becoming more flexible with the above structure and BEST PRODUCTS is happy to educate you on the variations that can make the difference in your choice of HMO health insurance. Primarily the highlights of HMO insurance include: Lower out-of-pocket expenses; no deductibles or plan limits; low cost doctor office visit co-pays of $15-$25; usually no or very low hospital deductibles; no paperwork or claim forms; pre-existing conditions may be covered; more comprehensive coverage; limited choices of doctors and facilities. If you were to travel out of state, you are covered for emergencies as if you were in the network.

Q: What is a High Deductible Major Medical policy?

A: A High Deductible Major Medical policy helps to offset medical expenses for hospitalization, surgery, lab work, doctor visits, outpatient prescriptions (within limits), and various other medical expenses, which may vary by carrier and state. The insured pays a monthly premium for coverage (much the same way one would pay a monthly premium to insure their automobile). The insured patient must pay all medical bills up to the deductible amount each year before the insurance company begins to pay on any medical bills. Most bills paid by the patient, provided they are submitted as proper claims through the insurance company by the provider or the patient, are generally discounted by the insurance company by a small percent until the deductible is met. The balance paid by the patient is then applied toward the deductible amount. There are no co-pays for doctor visits or prescription drugs using a High Deductible Major Medical coverage. Once the deductible has been met, the insurance company will pay a percentage of the remaining medical bills for covered services for the rest of the year. The patient will pay the remaining percent. This percentage, called "co-insurance", is chosen, along with the "deductible" amount, by the patient at the time of purchase of the insurance.

Q: What is an HSA?

A: An HSA (Health Savings Account) policy includes a High Deductible Major Medical coverage and incorporates a Health Savings Account that pays interest (% varies), and shelters income from taxation. This plan demands a higher deductible than a regular Major Medical plan, while co-insurance options are mostly the same. The amount that can be deposited into the savings account each year can be no higher than the deductible amount, and administration fees apply in some cases. Balances remaining unused for medical expenses at year-end are carried forward into the following year. The deductible amount can be deposited again in full each year, creating a higher savings balance that is earning interest, and so forth into coming years. The account must be closed at age 65 and all remaining funds are either used for medical expenses at that time, rolled into another type of investment plan, or are taxed as earned income.

* Most out-of-pocket medical expenses can be reimbursed by tax-free Health Savings Account money that the patient has sheltered using an HSA Major Medical program. NOTE: An HSA reimbursable service is not necessarily applicable toward an insurance deductible. Review your HSA insurance plan for more details.

Q: What is a PAO?

A: A PAO (Provider Access Organization) is not insurance. It is a Fee-For-Service Discount Health Benefits Program. This program is a wonderful supplement for High Deductible Major Medical and HSA plans. This program does not work well with “Comprehensive” (aka: Copay) insurance plans. Also, consumers who already have health insurance generally don't want to pay for more coverage unless they feel it will truly benefit them to do so. The decision for them to add a PAO Fee-For Service program to their health benefits package will most likely be made based on their ability to see the benefits of using the additional discounts on Doctor visits, Lab work, and Prescriptions, then applying their reduced costs toward their Major Medical or HSA deductible through proper claim submittals. They may also appreciate the Dental, Vision and Chiropractic benefits they receive with a PAO Fee-For-Service program, as well as the reduced fees for any hospital services that are not covered by their health insurance plan. This combination of Major Medical or HSA higher deductible insurance plans with PAO medical discounts can be as or even more affordable and beneficial to both the patient and the insurer than a Comprehensive (Copay) insurance plan with all its own additions. PAO discounted fees are HSA reimbursable when they are HSA qualifying medical expenses. It is wise, if you have a Comprehensive (Copay) plan, to not purchase this additional plan unless there are extenuating circumstances, such as if you are wanting to get discounts on medical services not covered by your present health insurance policy. A PAO Fee-For-Service program is also a wonderful program for those individuals who are uninurable, however a PAO Fee-For-Service program is NOT intended to replace insurance!