I've been researching different healthcare plans for NJ, and I'm a little confused about what exactly it means to have to pay a deductible. I'm familiar with the term, but I'm unsure about when I'd pay it, or what I'd have to pay it for.
The reason I ask is b/c with some of these plans, if you choose an outrageous deductible, like $10,000, the premiums are so low. But does that mean that I have to pay $10,000 if I get hurt? To see a doctor? Right off the bat?
I've been covered by Cobra for the past year, and it's about to expire. Right now I'm unemployed, and even if I do find a job within a month, I'll still be w/o insurance for a few months until I qualify with the new company. Are there month to month insurance companies?
Thanks for any help you can offer! I'm very confused!
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"Never give up, never surrender!"
A deductible is the amount you have to pay before the insurance company will pay anything.
So if you have a $10,000 deductible, then yes, you have to pay the first $10,000 of medical charges you incur. And that's each year. of course, if you only have $5,000 of charges, you only pay $5,000.
Also, even after you pay the $10,000, the insurance may only pay 80% or so, so you still have to pay 20% of the remaining charges.
These super-high deductible plans are coming out because they're meant to be paired with a Healthcare savings account (HSA), where your employer helps you put away the $10,000 tax-free to spend initially. I think it would be unusual to get one of these unless you have an HSA.
Not all charges are subject to a deductible amount. Doctor's visits often have a co-payment (like a deductible - cause you pay it) but you have to pay it every time. The deductile is yearly.
To save you a lot of angst, you might want to consider finding an independant insurance broker.
These brokers are savvy and deal with ALL health insurers (Blue Cross, Blue Shield, etc.) They do not charge you a fee for their expertise, consultation and help. They get commission from whichever insurance company they finally hook you up with.
They know all the ins and outs of the different plans available to you and which ones would be best for your needs. Mine deals with all KINDS of insurance. Health, auto, life etc. If you go this route, just make sure the broker you pick is indeed independent and doesn't have some "deal" with one particular insurance company.
If you feel by the way, that it's very likely you'll be employed again in the next 6-12 months most of the big insurers have what they call a "short-term individual health plan" which may be just what you need.
What companies have you called so far?
Does Oxford operate in NJ? What insurer were you covered with under Cobra? You might want to start with them first.
By the way, when Cobra expires, by LAW your employer is supposed to send you:
1) an official letter showing date of Cobra termination and 2) a Certificate of Creditable Coverage.
These are very important since they must be submitted with your application form for your new individual plan. The latter is particularly important, because in most cases, it will help you obtain coverage in spite of what may be deemed as a "pre-existing condition".
If you want virtually the same kind of coverage that you had on COBRA, be prepared for a bit of a shock... Your premiums will be higher. . It's really shocking what they charge for individual plans as opposed to group plans.
If you are basically healthy, do not have a chronic on-going health issue and see a doctor rarely except for annual check-ups or routine mammo/pap/gyne, most folks opt for a higher deductible in order to keep those monthly premiums low.
When I was researching for myself, I found that Blue Cross (of CALIFORNIA) had a plan with high'ish deductible ( I think it was $5,000 for medical and $500 for hospital) but the deductible was WAIVED completely for 3 doctor's visits per year....1 routine mammo/pap/gyne and 2 other doctor's office visits for any reason.
What was good about the $500 special hospital deductible is that IF something really catastrophic happened and I had to be hospitalized for ANY reason, I would just have to pay 500 bucks, not 5000, before Blue Cross would then kick in. After that 500 dollars, they would pay 70%. I would pay 30%. Now that may not sound like such a good deal given that hopsitals charge a million bucks for a sponge! HOWEVER, don't forget, apart from the deductible all health plans have an out-of-pocket annual maximum. The one I researched had a $7000 out-of-pocket maximum. Given that a couple of days in a hospital with x-rays and tests and don't forget surgery, anesthesiology fees etc could easily be $60,000 for something relatively simple, I could very quickly reach my out-of-pocket maximum, after which the insurer would pick up 100% of the tab
I'm probably confusing you even more and perhaps giving you waaaay too much information right now. But I too, found the process very confusing, trying to compare plans. It was like trying to compare apples and oranges.
And that's why I think if you have any friends who have a good insurance broker, it would take a lot of guess-work out of this for you.
Just remember, the deductible is the amount you pay out of your own pocket before insurance kicks in. Then, depending on the Plan, the charges could be 70/30 (they pay 70%, you pay 30%) or 60/40 or even 80/20. The out-of-pocket maximum is the total amount you will pay out of pocket for the year and then the insurer MUST pay 100% of all your bills after that.
Gosh..I've gone on and on and on here. Probably confused you more..
No, not at all, that was extremely helpful! You pretty much summed up what I needed to know to make the right decision. I'm still scared to set such a high deductible, though, b/c I literally don't have $7000 to pay if god forbid I need to. If I don't get hurt or end up hospitalized, do I still need to pay the deductible? How does that work? B/c right now with cobra I have a $50 deductible and I have to pay that regardless...or is that b/c I went to my doctor? (I had a few appointments with my pcp for miscellaneous things)
Tell me if this is crazy, but...I may start work in a week or two b/c I was offered a position with good benefits after a 90 day waiting period. Now, is it completely unheard of to just not have health insurance for a month or so until my new plan kicks in? I'm worried about this a couple reasons -- if I do end up hurt, it could be hundreds of thousands of dollars in medical bills. But also, would being uninsured mess up my chances of getting a good/low premium in the future?
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"Never give up, never surrender!"
If you don't get sick, or hurt or end up hospitalized, all you will be paying are your monthly premiums, not the 7000 or 5000 (or whatever the figure is) deductible.
This $50...is that what you pay each time you have a doctor's visit? That sounds more like something they call a "co-pay". After the annual deductible is met, some plans have you only pay a co-pay...i.e. a fixed fee per office visit, no matter what the charges. Other plans don't have a co-pay per visit and instead split the charges with you, as I mentioned earlier. The insurer would pay let's say 70% and the patient pays 30%.
All plans are different, HMO plans are different than PPO plans.
As Lenin suggested, OXFORD is a good insurer to look into...they have both. As do all the big companies.
What insurer are you using with COBRA? You might want to call them first and start from there.
The choice to go without coverage is a very individual and personal one, depending on your health status, age and of course anxiety level about the idea of it!!
Also, if you have a break in coverage there may indeed be certain penalties imposed when you start up again, either individually or through a new employer.
I believe that if you have a break in coverage (after COBRA lapses) of longer than 63 days, that letter of Creditable Coverage I mentioned earlier no longer protects you from exclusion periods on any new plan you get or from what an insurance company calls "pre-existing health conditions".
This is critical and that's why I really think you should discuss this with a BROKER.
Definitely look into SHORT-TERM plans if you need coverage for only a few months. For me, it's the hospital stuff that I would want to make sure I have some coverage on, because all it takes is one "event", not even a catastrophe, and it could wipe you out financially.
