What's the best health plan for my family?

The best insurance plan for your family depends on your particular desires, budget, age, and family health history. An HMO plan may be ideal for someone with small children who need to see the doctor often for flus and colds, while a $2000 deductible indemnity plan might be better for a healthy twenty-five year old who seldom goes to the doctor. At David B. Mulberg and Associates we give you the information to allow you to make an intelligent choice.

One of the first factors you will look at in choosing a health plan is your monthly premium. Monthly premiums are determined by your age or your spouse’s age, what county you live in, the type of plan you choose.

You will decide the type of coverage and the benefits you want when you apply for insurance and will be quoted the rate for that plan. Below are descriptions of the major types of coverage offered by insurance companies.

HMO

An HMO (Health Maintenance Organization) is an organization of doctors paid a monthly fee in advance by the insurance company for your care. Usually you will be assigned to one doctor, called your primary physician, who will care for you. Your doctor is also referred to as a gatekeeper, because that doctor must approve any medical services you receive and you cannot see another doctor without first obtaining a referral.

You will pay a fee when you see the doctor. The amount of the fee can range from about $4 to as much as $25.00. Some services, such as hospitalization, will also require you to meet a deductible or co-payment. HMO plans with higher co-payments and deductibles will be lower in monthly premium.

The restrictiveness and quality of HMO’s varies enormously. Large organizations usually provide a better level of care with more physician and service options available to you.

Indemnity plan

The traditional medical insurance plan. In the most liberal of these plans, you may go to any doctor you choose whenever you like. You then submit the doctor’s bill to the insurance company on a claim form. The insurance reimburses you after subtracting the yearly deductible and co-insurance amounts that you chose when you bought the plan.

You will often hear co-insurance referred to as 80/20, 70/30, 90/10, etc. This means that after your deductible, the insurance company will pay 80% of the bill and you will pay 20% until you reach your stop-loss. A stop-loss is the maximum amount that you can pay toward your health care each year. After your stop loss is exceeded the insurance company will pay 100% of your medical care costs for the remainder of that year (usually through December). You will have to meet a new deductible and stop-loss at the start of each year.

The premium for this type of plan will be more expensive because the insurance company has less control over your care. Most plans now carry cost cutting restrictions to keep premiums affordable. These include limits on certain services, required pre-authorization for surgery, and additional co-payments.

PPO

Preferred Provider Organization - A group of doctors who have contracted with an insurance company to accept a lower fee for their services. One doctor may belong to several PPO’s. Your insurance company will give you a list of approved doctors, and you may go to any of these you wish.

On most PPO plans, you may go to a doctor who is not on the list, but you will pay significantly more for his services and some services may be paid only if provided by the PPO doctors and hospitals.

You can buy a PPO plan for about the same monthly premium as an HMO, but your yearly out-of-pocket cost will be more. A PPO insurance plan gives you more choice in your medical care than an HMO at a lower premium than the traditional indemnity plan.

Dual Option

A plan that is both an HMO and PPO at the same time. When you buy the plan you will choose a primary care physician. If you go to this HMO doctor you will pay just your office visit fee, typically $10.

If you go to doctor on the insurance company’s PPO list, you will meet a deductible and co-payments before the insurance company will reimburse you for your medical bills.

This is a relatively new concept in individual health plans, and is currently being offered at rates comparable to the PPO plans.

Eligibility

Since 1993 everyone in California is eligible for some type of health insurance, even if ill, under the State Major Risk Insurance Plan. However, premiums for a guaranteed issue plan are higher and benefits limited, and there may be a waiting period before you are accepted.

Under the Federal Federal Kennedy /Kessenbaum Act of 1996, individuals who have been covered under a group plan for at least 18 months and have exhausted COBRA benefits must be accepted for individual plans effective July, 1997.

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