I LOVE October. The weather finally starts to cool off (a little), the leaves change, and pumpkin foods fill the stores. Costume and c andy time will come at the end of the month, but until then it is all about fall weather and pumpkins for me. Beside Halloween, it is pretty much the last month of relaxation and mellow time before the holiday frenzy sets in. It is probably a really good time to create your monthly to-do list and re-prioritize. The more projects, err ands, and such that you complete during October, the less stress you will experience during November and December. After all, who doesn’t want to feel more focus when planning the holidays and doing all that shopping?
If you didn’t put this on your list at the beginning of September, it is no time to put it at the top of your to-do list for October – IT IS TIME TO GET A LIFE INSURANCE POLICY.
Come on…no more procrastinating or excuses. There is absolutely no reason for you to continue without a policy. Do it today and get it out of the way. You will have the rest of the month to work through your remaining to-do list and can do it without the stress of worry about a life insurance policy.
Every once in awhile there will be front page news about the health care crisis. The escalating costs for hospital and physician services are making it more difficult for the insurance companies to stay competitive and at the same time take care of the needs of their policyholders. A family health insurance plan in today’s marketplace is evolving into something quite different from years past. The employer group health insurance insures the majority of Americans but there is a trend developing. There are more folks leaving their employer to start their own business. When you add that group of people to the folks that leave their employer because of lay-offs, illness, and terminations then you are creating a great dem and for family health insurance.
Insurance companies are working hard to develop new solutions. The federal government has great interest in health care insurance. The hospitals and physicians are deeply affected by the insurance industry.
There has been a major shift in thinking about health insurance. It has become increasingly clear that higher deductible health insurance plans are much more cost efficient in the long run compared to the low deductible plans of years past. The higher deductibles reduce the cost of health insurance dramatically. The lower deductibles are no longer in vogue. The high premiums for the low deductible no longer justify the premiums.
1. High Deductible Major Med – The insurance professionals are encouraging people to take the higher deductible major medical policies. You are well protected for a major illness or injury in exchange for self-insuring the smaller claims.
2. Health Savings Accounts – This is the federal government’s contribution to the health insurance dilemma. These savings accounts are established by the individual for medical expenses only. They are tax deductible similar to an IRA and are great vehicles to use for the out of pocket expense from the higher deductible.
Is there such a thing as cheap health insurance? It hardly seems possible when you look at the rise in hospital costs and physician services. Insurance companies have the task of underwriting the medical risk for insurance. The insurer then issues and delivers the policy to the insured once they are accepted into the plan. The policyholders then receive the policy declaration pages that list all of the benefits and features.
What are those benefits and features? How do they work after a hospital stay? When you begin to find the answers to those questions then you begin to underst and what makes up the total premium. When you receive your first benefit statement after a hospital stay then you will begin to underst and how the deductible is applied and how the coinsurance works.
Simple claims analysis
1. Total inpatient expense for 4 days in the hospital including physician services amounts to $4000.
2. Your policy has a $500 deductible with an 80/20 coinsurance clause with a maximum out of pocket $2000.
3. You must pay the first $500 for your stay leaving a balance of $3500.
4. You will pay 20% of that $3500 or $700 and the insurance company will pay $2800.
When your 20% reaches $2000 then the insurance company pays 100% of the remaining costs up to a million dollars (or 2 million etc).
The health insurance buying trends indicate that people are purchasing health insurance with higher deductibles. Deductibles bring down the premium dramatically. There are some plans with deductibles as high as $5000. This is called self-insuring because in essence that is what you are doing for the deductible amount.
Health Savings Accounts are also starting to become very popular. These savings accounts are tax deductible. They are like medical IRA’S. Contact your tax advisor or accountant for more details.
Please see our recommended source for insurance quotes. We have done the research so you don’t have to.
The discussion about health insurance will rarely cross your mind as long as you are employed. The group health insurance benefits that you have while you are employed are so easily taken for granted. There may come a time when a change or loss of employment may send you scrambling into the health insurance market place. You will have a lot of new decisions to make. You will have to educate yourself very quickly because there is only a 60-day window after separation from your employer to purchase a new plan.
There are an increasing numbers of baby boomers reaching their mid-fifties that are leaving their employers and starting businesses. This requires health insurance planning. An affordable health insurance plan is only possible when you begin to underst and the basics of health insurance.
Group health insurance is almost always a Major Medical plan. There is a lifetime maximum payout of benefits up to a million dollars in most plans. These plans have the typical in-patient and out patient care subject to a number of different deductibles. It is imperative that you underst and the major medical policy. You do not want to purchase supplemental health policies to replace a major–medical plan. Hospital Income policies are one type of supplemental health insurance. The hospital income policy pays the insured a dollar amount benefit for each day that you are hospitalized and not much else.
Your best way to make health insurance more affordable is by taking advantage of the premium reductions gained from taking higher deductibles. The next step is starting a health savings account to fund the deductible and any other unforeseen expense. The health savings account is tax deductible. Your accountant or tax advisor will give you more details.
Insurance is usually the best way to decrease your monthly bills when you want to save money. Please see our recommended source for insurance quotes online to get the cheapest rates possible. We have done the research so you don’t have to.
Susman Insurance Agency,
11611 San Vicente Blvd. Suite 515,
Los Angeles, CA 90049