The seven characteristics of great coverage are:
If your health insurance plan is missing one of these, your coverage is compromised and either you're going to get limited care or you’re going to end up with a lot of cash out-of-pocket expenses if you get sick or have an injury or both. So, let's talk about each one:
A Nationwide Network is required and an absolute must. This is especially true if you live close to any state line. With many plans, as soon as you go out of state, you are out of the network and your benefits drop by an average of 20%. They go from 80/20 on the co-pay to 60/40, and the “stop loss” limit of $10,000 goes away; so instead of owing 40% of $10,000, you could owe 40% of the whole bill! If you had a heart attack with one of these policies while traveling out of state, and the hospital and doctors cost $500,000, your co-pay could be $200,000! There are dozens of companies who sell policies with terms like this buried in the fine print, and it's one of the big secrets that these insurance companies do not want you to know. But don't worry, because we don't let our clients participate with any insurance company that doesn't offer a nationwide network of hospitals.
A PPO (Preferred provider organization) is necessary so that you have a choice of doctors and hospitals and you don't have to get a referral to go to a specialist. The PPO discount can be huge; as much a 70%. There are six companies that are both a PPO and offer a nationwide network.
A Prescription Card is a must. Today's prescriptions can run anywhere from a few dollars to $5000 per pill! You might need an expensive prescription to save your life. The purpose of insurance is to pay for this. You should not pay for insurance and then also be stuck with the huge cost of prescriptions.You want to avoid prescription limits of $2000. Even some of the best companies offer this $2000 limit as a choice, but if you have a major illness or accident, you could run up more than $2000 in prescriptions in a hurry.
Transplant Coverage is a critical element. Never enroll in any health insurance plan that does not cover transplants, or that has limited transplant coverage. Nobody ever thinks that they will have a transplant in their lifetime, but if you go to any transplant center in the US you will find people of all ages, from all walks of life, who needed a heart, liver, lung, kidney, and bone marrow transplant. Due to the scarcity of the specialized centers, it is not likely that the transplant center you may need will be in your particular state, which means that you must-have full transplant coverage and you must have a nationwide network.
Room and Board with no limits (including intensive care unit) is essential. The average overnight stay in the hospital today is more than $1000. You do not want a plan that covers $200 per day or $400 per day or $600 per day, leaving you with a huge bill to pay when you get out of the hospital. There are many plans sold every day with these types of limitations, but if you had a seven day hospital stay and your plan only covered $400 dollars per day, you would owe an additional $4200, over and above what your insurance plan would cover. Also, intensive care coverage is typically four times the cost of a regular hospital room, so if you spent those seven days in the ICU, you would owe more than $16,000. That's why we don't offer coverage that has limits on room and board.
Inpatient and outpatient coverage is a must in today's environment. As I said earlier, more than 75% of all medical procedures are now delivered on an outpatient basis, but there are still many hospitals and surgical plans that do not cover one penny of outpatient services. There are other plans that limit outpatient claims to a certain limit. If you have a $500,000 outpatient claim and your outpatient limit is $200,000 you'll be stuck with $300,000 of non-covered charges. You don't want a plan that doesn't give you unlimited outpatient coverage.
Therapy coverage without limits is a must. You must have coverage on occupational, vocational, rehabilitation, radiation, physical and chemotherapy. Many insurance plans will limit the number of visits. For example, if you tear your Achilles tendon, some plans will limit you to five hospital visits, but your recovery time will actually be 6 to 10 weeks and may require as many as 20 visits for therapy. So, your plan must have therapy coverage, without exclusions, and must not be limited to anything less than 25 visits per occurrence.
So, let's start with Discount Plans, which as I said, are not real insurance. These plans simply give you a discount of 20 to 30% off of medical services when purchased through one of the providers in their network. An example of why you don't want one would be if your wife bought a $100 dress and the discount was $30, you would still owe $70. The same is true with a PPO network discount: If your hospital bill is $100,000 and you receive a 30% discount ($30,000), you still owe $70,000. This is not a plan that you should allow into your health insurance package. I am assuming that you want real insurance, right?
Fee Schedule Plans are real insurance, but they have hundreds of limitations in almost every category of claims. Many of them pay only $100,000 or $500,000 for surgeries and hospital stays. If you have an $800,000 hospital bill and the lifetime maximum on your policy is $500,000, you're going to owe $300,000 when you get home from the hospital. And usually, these plans have no prescription card, so if you ever have to go into intensive care and need lots of medication, you won't be covered and you'll have to come up with that cash out-of-pocket. Also, it looks like the new healthcare bill is going to eliminate these plans anyway, and I am assuming that you really don't want a plan that just pays some of your bill, when you can get one without all these limitations for about the same price, right?
Hospital Surgical Plans are real insurance, but they have a critical flaw. In the old days of insurance if you had the flu, for example, they put you in the hospital. In fact, they hospitalized you for almost everything, and these Hospital surgical plans were designed for that system but that was prior to the growth of outpatient centers. These plans cover inpatient services only. They do not cover outpatient, even though outpatient services represent more than 75% of all medical procedures today. You can purchase a medical plan that includes both outpatient and inpatient for approximately the same price, so can you see any reason why you would want inpatient coverage only?
HMO Plans are also real insurance, but unfortunately, they also have a lot of restrictions and limitations. For example:
HMO plans do have excellent “check up” coverage, but basically, these plans are like the oil change place for your car, not the mechanic. If you need an engine repair, you would never go to an oil change place. For repairs, you have to go to a mechanic. It's the same thing here. You don't want an HMO with great check up coverage and limited coverage when you're really sick or injured. Instead, you want a major medical plan, with minimal restrictions, and you want it to have a PPO, which stands for “preferred provider organization”, which is an organization of providers from all around the country that agreed to offer significant discounts to their members, and you also want your plan to include inpatient coverage, outpatient coverage, doctors visits, and prescriptions everywhere you go in the United States.
The Major Medical Choice
Bottom line, all of these other plans that we talked about have major restrictions and don't do an adequate job of protecting you and your family. The choice that does the job is Major Medical. It's the right choice. It's not a discount plan, it's real insurance. It's not an HMO, but a PPO with a choice of doctors and hospitals. It's not a fee schedule plan, because it covers your bills, not just a portion of them. It's not a hospital surgical plan, because it covers inpatient and outpatient services. Major medical covers inpatient, outpatient, doctor visits, and prescriptions, and it doesn’t have holes in the coverage, or loopholes for the insurance company to avoid paying claims. There are only 6 companies in the US that offer comprehensive major medical plans that have all seven characteristics of great coverage.
