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All About COBRA - Annual Deductible - Brand Deductible - Deductible - HSA Qualified Plans - Inpatient Admission - Inpatient Hospitalization - Lifetime Maximum - Maternity Care - Maternity Care - Maximum Annual Benefit - Office Visit Copay - Out-of-Network Coverage - Out-of-Pocket Maximum - Outpatient Surgery - Point of Service Plans (POS) - Prescription Drug Coverage - Prescription Drugs - Primary Care Office Visit - Primary Care Physician (PCP) - Sole Proprietor - Specialist - What is a HMO (Health Maintenance Organization)? - What is a PPO (Preferred Provider Organization)? - What is co-insurance All About COBRA - What is COBRA?
COBRA is 1985 federal legislation that requires employers with more than 20 employees to allow employees that leave the company to continue their insurance in the company plan for 18 to 36 months. The employee is required to reimburse the employer for the cost of the insurance plus up to a 2 percent administrative fee.
Special Note: Even though your employer is paying a group rate and allowing you to pay this same group rate after you have left the company, COBRA can still be an expensive option. You may be able to save substantial money by exploring individual and family health insurance options, but before you do …read on below…..
Follow the wisest course of action!
It may be wisest to continue your COBRA benefits if:
- you have very comprehensive benefits and don’t mind the extra cost.
- you have had health problems recently.
- you have had chronic or continual health problems.
- you are required to take expensive medications.
- you have been declined for insurance recently.
It may be wisest to consider a COBRA Alternative if:
- you want continual coverage but at a lower cost and
- you have not had any significant chronic health problems and
- you have not received any recommendations from physicians or healthcare workers to undergo a medical procedure in the future.
Individual and family insurance products are often much less expensive than COBRA insurance because they reward people for good health and healthy lifestyles. Annual Deductible - This is the annual amount of covered healthcare expenses for which you are responsible before the insurance begins paying. Often, prescription drug copayments are not applied toward this deductible amount.
Individual deductibles are satisfied when one covered person has paid the deductible amount. Then the insurance plan will begin to pay claims for that person. The family deductible amount is often two or three times the individual deductible. The family deductible is satisfied for all family members when two or more family members have paid an amount toward the deductible equal to the family deductible. At that time, the plan will pay for covered services for all family members according to the plan’s coinsurance benefits.
Some plans do not have a family deductible, but have a two-member maximum. Insurance benefits begin to pay for services for each family member only after such member has satisfied the individual deductible. In the event that two family members reach the individual deductible, then all family members are considered to have satisfied the deductible. Family members that have paid toward the deductible, but did not reach it, may have such monies reimbursed by the insurance company.
Aggregate deductibles are typically associated with HSA-eligible plans. Family plans with aggregate deductibles do not have an individual (or per-person) deductible and do not begin to pay for covered services until the combined payments from family members satisfy the aggregate deductible. Brand Deductible - This is the annual amount of covered brand name prescription drug expenses for which you are responsible before the insurance begins paying. It applies to both brand and non-preferred brand name drugs. Deductible - The amount you must pay for healthcare services before your insurance plan begins making payments on claims. There are typically two types of family deductibles: per person or aggregate. Per person deductibles are where when one covered person reaches the deductible, the insurance plan will begin to pay claims for that person. Many family per person deductible plans will have a two person maximum, so that after two people have each satisfied their deductible, the third person will not have to reach the deductible before claims are paid Aggregate deductibles are often found in HSA-eligible plans. For aggregate deductibles no claims are paid by the insurance company until the combined payments made by the family satisfy the deductible. Many plans have different provisions, so please see the details of the insurance plan you are considering. HSA Qualified Plans - Health Savings Accounts (HSA) are high deductible health plans that enable you to put money aside on a pre-tax basis to pay for certain medical expenses. Inpatient Admission - Medical services, supplies or treatment received for an illness or injury as an overnight resident of a hospital or other facility. Inpatient Hospitalization - Medical procedures that require the patient to stay at least one night in a hospital.
Please note that definitions vary across insurance companies. Lifetime Maximum - The maximum dollar amount that a health insurance company agrees to pay on behalf of a member for covered services during the course of his or her lifetime. Please note that definitions vary across insurance companies. Maternity Care - Maternity care coverage typically includes OB/Gyn visits, hospitalization and physician fees associated with the birth of a child. Maternity care benefits vary by insurer and many insurers offer it as an optional benefit or do not cover maternity care. Maternity Care - Maternity care coverage typically includes OB/Gyn visits, hospitalization and physician fees associated with the birth of a child. Maternity care benefits vary by insurer and many insurers offer it as an optional benefit or do not cover maternity care. Maximum Annual Benefit - This is the maximum amount of prescription drug coverage allotted per member per year. Additionally, some limit the prescription drug benefit to an Annual Benefit Maximum. Office Visit Copay - The Copay is a fixed dollar amount paid directly to the participating provider each time you visit the office. Out-of-Network Coverage - Benefits for seeing providers not in the health plan’s network. PPOs will pay a lesser share of the cost of seeing a provider outside the plan’s network. HMOs typically do not have non-emergency coverage outside the plan’s network unless the service has Out-of-Pocket Maximum - This is the sum of your deductible and maximum coinsurance amounts. Once this limit has been reached, services are covered at 100% for the remainder of the year. Non-covered services are not applied toward the out-of-pocket maximum. Outpatient Surgery - A procedure performed in a hospital or outpatient treatment facility that does not require an overnight stay in the hospital. Point of Service Plans (POS) - Combination of HMO and PPO features. They provide a comprehensive set of health benefits and offer a full range of health services much the same as the HMO. However, the member does not have to choose how to receive services until they need them. The member can then opt to use the defined managed care program, or can go out-of-plan for services but pay the difference for non-plan benefits (e.g. 100 percent coverage for managed care Vs. 80 percent coverage out-of-plan). Prescription Drug Coverage - Coverage applies to drugs that require a prescription from a physician.
Many insurance companies charge different copay amounts depending on the category of a drug. They are typically categorized as generic, preferred brand and non-preferred brand drugs. Generic drugs have the lowest copay as compared to brand or preferred brand drugs. Often, brand name drugs are subject to a separate deductible.
Insurance carriers categorize drugs according to its formulary. Please review the insurance company’s specific formulary and prescription drug benefit carefully to fully understand your benefits. Prescription Drugs - A prescription drug requires a physician prescription to be obtained.
Many insurance companies charge different copayments depending on the category of drug. Typical categories are generic, preferred brand and brand. Generic drugs often require a lower copayment than brand.
An insurance company categorizes drugs according to its formulary.
Some companies limit the prescription drug benefit to an Annual Benefit Maximum. Please check the insurance company’s specific formulary and prescription drug benefit to fully understand your benefits.
Please note that definitions vary across insurance companies. Primary Care Office Visit - This is an evaluation and management service rendered by the primary care physician (PCP). Primary Care Physician (PCP) - These physicians provide their patients with a broad spectrum of health care, both preventive and curative, and coordinate all of the care patients require including referral to specialist physicians. Typically, primary care physicians include providers that focus on family practice, internal medicine, general practice and pediatricians. Some plans also allow OB/Gyns to be selected as PCPs. Sole Proprietor - A Sole Proprietor is the owner of a business with the owner being the only employee.
To see if your business qualifies, review the eligibility requirements of each carrier below.
Specialist - These providers are physicians whose practice focuses on care other than those defined as primary care physicians. What is a HMO (Health Maintenance Organization)? - HMOs are managed care plans that provide care for enrollees by contracting with specific health care providers to provide specified benefits. Many HMOs require enrollees to see a primary care physician (PCP) chosen by the member who will refer them to a specialist if deemed necessary.
HMO plans often do not include deductibles, but copays are charged per office. HMO plans typically allow a member to have lower out-of-pocket healthcare costs, but require the member to forego some choice and flexibility with regard to selecting physicians and hospitals.
Additionally, HMOs do not cover non-emergent services received from providers outside the network. HMOs do not require members to submit claims to the insurance carrier. What is a PPO (Preferred Provider Organization)? - A managed care arrangement consisting of a group of hospitals, physicians, and other providers who have contracts with an insurer to provide health care services to enrollees at a predetermined rate.
PPOs also allow members to see physicians and hospitals out of the insurance company's network, however, these visits will require higher out-of-pocket costs for the member. Please check the details of each plan. What is co-insurance - This is a percentage of eligible medical costs that are paid by the member once the deductible has been met.
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