What if I leave my job?
Friday, June 05, 2009 | 0 Comments
Health Savings Accounts
If you are considering changing your health insurance policy, you should be aware of the alternative of a Health Savings Account (HCA).
Health Savings Accounts started to become available (and legal) in 2004, allowing people with
high-deductible insurance policies to set aside tax-free money to fund medical expenses up to the
maximum deductible amount.
If you don’t have to use the funds, it rolls over every year. Once you reach age 65, you no longer are required to use it for medical expenses, although you certainly can; you can withdraw funds under the same conditions as a regular IRA.
Although you will be penalized if you use the funds for non-medical expenses prior to age 65, you can use the money for vision care, alternative medicine or treatment and dental care.
For 2008, an individual may fund up to $2,900 tax free. The maximum deductible would be $1100 and the maximum out-of-pocket cost would be $5,600.
For a family, the maximum tax-free contribution is $5,800 with the maximum deductible of $2,200 and the maximum out-of-pocket cost would be $11,200.
Health Savings Accounts are certainly a viable way to shelter income while providing catastrophic insurance coverage in light of the high cost of low-deductible health insurance plans.
For healthy people, it deserves some research. Consult with your insurance agent for all of the details involving this approach to managing your insurance needs.
Friday, June 05, 2009 | 0 Comments
What is health insurance?
There are many levels of health insurance coverage available; unfortunately, like most things in life, you get what you pay for, and good coverage can be very expensive.
The two most common terms in referring to health insurance are premium, which is the amount paid for the insurance, and deductible, which is your out-of-pocket expense before the insurance pays your provider.
For instance, you might pay $300 premium per month for family coverage, and your deductible might be $250 per person, which means if you fell and broke your ankle and went to the hospital emergency room, you would be required to pay the first $250 of the bill.
You can purchase very basic catastrophic coverage, which would carry a very high deductible and the premium would be less than comprehensive coverage which would have a higher premium and lower deductible. It pays to invest the time to investigate various insurance options, taking into consideration your age, your general health and the health of your family members.
Your employer may offer group health insurance, which is most likely the least expensive option for you, and usually the premium is deducted from your paycheck.
Health insurance is a calculated risk; can you afford the premiums or are you willing to risk that you would pay less out of pocket for medical expenses in a year than the premiums would cost? Consider carefully.
Thursday, June 04, 2009 | 0 Comments
Prescription Insurance Policies
Some health insurance policies do not provide for prescription coverage and a separate policy must be purchased for prescription medications.
This is an area where it pays to do some homework and research and find the best policy for you.
Prescription coverage insurance is not a necessity; like health insurance coverage, it is a calculated risk, although the risk is not as high.
Usually you can buy prescription insurance at any time, so if the doctor determines that you need an expensive maintenance drug, you may opt in at that time.
It is important to know that if you presently have prescription insurance you can usually only change it at a specific time of the year, although you can add new prescriptions, you can’t change plans.
The person who seldom takes prescription medications probably does not need prescription insurance; however, a person who takes maintenance drugs for high blood pressure, diabetes, depression, heart disease or immune disorders most likely needs insurance against the high costs of drugs.
Prescription insurance policies usually have "tiers", which usually means that a generic drug is at a low or no co-pay, a tier 2 level may be the brand name genuine, and a tier 3 may be a brand new expensive drug that the co-pay could be a set high-percentage of the cost.
In choosing prescription insurance, you should first list the prescriptions that you take and the retail amount of them. If you chose not to purchase insurance, this would be your monthly cost.
Find out from the provider what the monthly premium for you would be, then what the prescription co-pay amount would be and add these two figures together. Which is the less expensive alternative?
Thursday, June 04, 2009 | 0 Comments
The Importance of Keeping Good Files
As in everything that involves money, it is important to keep good records of your medical expenses for many reasons.
Keeping track of deductibles, especially for a family, can be time consuming, but is an important task. Every policy has different deductibles for lab work, hospital emergency room visits, hospital stays, doctor visits and x-rays, and it is often difficult to track.
Keeping track of your out-of-pocket expenses becomes very important when it comes time to complete your taxes. It also comes in handy to know what your expenses are for medical care when choosing to change companies or policies.
A file folder that includes a copy of the policy, copies of your medical bills and copies of what your
insurance company has paid on those bills is usually all you will need.
When a bill comes for a provider, you will usually receive a statement from your insurance company showing what portion of the bill they paid, and many times providers write off the remainder, if it is not a large sum.
If you visit several doctors, you may want to have a file folder for each doctor or provider.
Insurance companies do occasionally make mistakes, but they are usually on top of their game. Having a copy of the policy handy makes it easy to check deductible levels and whether a particular service is covered or not.
It also serves as a ready resource for telephone numbers, website information and your contact at the insurance company.
Wednesday, June 03, 2009 | 0 Comments
What Happens When I Retire?
Health insurance considerations weigh heavily on the minds of people wanting to retire before Medicare coverage kicks in at age 65. Many people put off retirement simply because the cost of an individual health insurance policy is too great on a limited income.
What options for health insurance do you have if you choose to retire before age 65? Although they are not required to, you may be able to get COBRA-like coverage from your employer.
As an added retirement benefit, your employer may allow you to pick up the premium on your policy; although paying 100% of your premium may initially appear to be an expensive option, purchasing an individual policy apart from a group may be even more costly and not provide you with the level of coverage you previously had.
Some companies are offering basic high-deductible insurance reasonably in the hopes that they will be able to enroll you in Medicare Part C (supplemental insurance) when you retire.
Another option is to budget and save money to cover your anticipated medical costs for the time period between retirement and age 65. If you are in very good health, this may be a viable alternative for you.
Pre-planning for retirement is an important issue; the earlier you start planning, the better. realizing the Medicare does not pay all of your medical expenses, you should budget money for medical expenses even after retirement.
Wednesday, June 03, 2009 | 0 Comments
Disability Coverage
Short term disability pays a portion of your wages should you be out of work due to injury for up to one year. Some employers pay for this benefit for their employees, some offer it for employees to purchase.
If you have a pre-existing medical condition, the time to enroll is during the initial enrollment period when a medical exam is not required.
Replacement of wages is only partial; insurance underwriters, as well as your employer, want you back at work as soon as possible. Usually there is a waiting period of 14 days in which you will not
receive payment.
Long term disability policies are purchased to replace what your potential earnings would be from the time you become disabled until age 65 when Medicare would be available.
For instance, if you are 55 and make $40,000 per year, you should purchase a policy for $400,000.
You cannot get a long term disability policy if
(1) you are or are soon to be pregnant,
(2) make less than $18,000 per year,
(3) are unemployed, or
(4) you are required to carry a weapon for your job.
Typically, the waiting period for long-term insurance to kick is at least 60 days and as much as a year.
Disability insurance is an important aspect of your overall insurance coverage plan, and if your employer offers it as a benefit you should definitely consider it as a wise investment.
Monday, May 04, 2009 | 0 Comments
