What’s the difference between HMO, PPO and POS plans?
The types of coverage you can get break down into three major plans: HMO, PPO, and POS.
An HMO is typically the most affordable option. Under this plan, you choose a primary care provider for all of your health care services, and must obtain a referral for specialists unless you have an emergency. While there are a few exceptions to this rule, your primary physician will coordinate all of your services, saving you paperwork and costs.
Under a PPO plan, you have greater flexibility to choose your health care services because you are not required to select a primary physician, but you will almost always pay more for your coverage. If you see a lot of specialists, this may be the best option for you.
The least familiar plan is an POS–it stands for Point of Service. It combines the cost savings of an HMO plan with the flexibility of a PPO. These types of plans can vary– in some instances with a POS you may be required to obtain referrals for specialists while others may not. And while a POS plan allows for out-of-network healthcare services, you will pay the bulk of the cost incurred for services received outside of the network.
What is a Health Savings Account (HSA) and why would I consider it?
A Health Savings Account (HSA) is a tax-advantaged plan where you can put money aside that can be used penalty-free and tax-free for qualified expenses. Typically, these plans have lower premiums and the money being set aside is tax-free, whether it’s taken from your paycheck before taxes or reported on your tax return. Unlike an FSA account, the money you save rolls over from year to year and can be drawn on for any purpose at age 65 without a penalty (however taxes would still apply if not used for an eligible expense). Other advantages of these plans include being able to roll your account over if you switch employers, your employer can make tax-free contributions to your account (hello free money!) and you can use this account to save for your retirement.
The ability to save money sounds great, but there’s a significant flip side you must consider. An HSA requires a high-deductible plan, meaning you could potentially pay quite a bit out-of-pocket to meet your deductible before your insurance company starts to kick in. These costs are based on contract rates between the carrier and the provider. Many types of medical expenses, such as prescriptions, count towards your deductible, while others such as dental care or eye glasses, do not. For all of these services however, you may use the money you’re putting aside into your HSA to pay for these expenses.
Thanks to the ACA, many medical services are now provided to me for free. Does this apply to my dental care or vision plans as well?
For the most part, the benefits and rights offered under the ACA do not apply to dental or vision care. The one main exception applies to children – dental and vision care must now be offered for children, but you are under no obligation to take it.
Will my disability policy include dental and vision coverage?
No. Short-term and long-term disability policies are designed to replace a portion of your lost income in the instance of expected (i.e. maternity leave) or unexpected (i.e. injury from a car crash) leave.
How much life insurance should I get?
The answer to this really depends on your situation. You should look closely at your current situation, as well as your future obligations. Are you married? Your spouse is unlikely to return to work immediately, so will not only need help with funeral and medical expenses but a resource to tap for bills while they grieve. Do you have children? Consider the impact your loss will have on their future education bills. We can help you assess the right amount of coverage dependent on your specific needs.
What’s the difference between in-network and out of network providers?
In-network providers are contracted to work with your insurance carriers and have negotiated lower-rates, meaning you pay less for healthcare services depending on your plan. Out-of-network providers have not accepted the discounted rates and therefore can be more expensive. It’s important to note however, the difference between being innetwork and accepting your health insurance. A healthcare or dental provider may accept your insurance without being in-network, which will result in higher payments for you.
It’s up to you to ask when deciding where to go for services. Make sure to ask if the provider is “in-network”
What’s the difference between a deductible, co-payment and co-insurance?
Used together in a single plan, these terms can be confusing. In short, your deductible is the amount you must pay out of pocket before your insurance carrier begins to pay out of their pocket; a co-payment is a pre-determined amount you agree to pay to a provider when services are given, and co-insurance is the percentage you owe after your health insurance carrier has paid its portion–typically, this percentage is within 20-30% of the total bill.
If I apply for healthcare and am approved, am I obligated to purchase that plan?
No. While you normally must include payment information during the application process, you may cancel anytime during enrollment. Most insurance companies will not charge you until you have been approved, although a few carriers may require a nonrefundable application fee. We will always notify you of this before beginning the application process.
What does Lyons & Associates charge for helping me find the right coverage?
There is no additional cost to you for our help! Insurance carriers build in brokerage rates to all plans and pay us a flat rate to help you enroll in coverage. It’s important to know you’re paying this fee whether you use our services or enroll directly through the carrier’s website.
Can I stay on my employer’s group plan or do I have to move to Medicare when I turn 65?
This answer will depend on the number of employees that are employed and is best answered when we can ask a few questions to make sure we correctly answer. This also gives us an opportunity to guide you through any timelines.
I have people tell me that Medicare Advantage plans are best and others say that I should enroll in a Medigap (Medicare Supplement) plan. What should I do?
While family, friends, and neighbors mean well, only you know your financial and medical needs. Our job is to get you the information that you need to make the best decision for you!