Having health insurance helps to protect us from high health care costs that most people could not meet in any other way. It helps us pay for health care, and it ensures that we have access to care when we need it. Research has shown that having health insurance is closely tied to the quality and timeliness of care.

 

Shopping for health insurance can be a daunting task and the research to find the right plan can be quite tedious. This guide will help you better understand the important aspects of the Texas Health Insurance market and help you feel more confident in making the best decision for you and your family.

 

This guide is intended to help you sort through your Texas Health Insurance options. Before you make a decision, be sure to consult the brochures and policies of the plans you are considering for more specific information. The time you invest in researching your Texas Health Insurance choices will make a big difference, not only in how much you pay out-of pocket, but also in how easy it is for you to get care and how satisfied you are with the health care services that are available to you.

 

In this guide, you will receive general information about the various types of health insurance. You will also learn about things you should consider when choosing a health insurance plan.

 

It is very important to compare plans carefully to find the one that is best for your situation. Read and compare policies. You should contact each plan you are considering and ask them for a summary of their benefits. Be sure to ask questions if something is unclear. Also, ask whether your doctor or a doctor you may be considering participates in the plan. To be safe, you should also contact the doctor’s office to confirm that they will accept the plan.

 

Who needs Individual & Family Health Insurance?

 

The simple answer is any one who can’t get Health Insurance through their employer or seeks an alternative to their employer group plan.

 

Here are some scenarios to consider:

 

 

For You – Companies are only required to pay for 50% of an employee’s coverage (some companies may pay more or even all of your cost) and depending on the average age and overall health of your fellow employees even your half can cost hundreds of dollars a month. Also, corporate health insurance plans tend to have lower deductibles and stronger coverage than you might want to pay for. If you find yourself in this scenario, it might make sense to explore Individual Health Insurance on your own. Keep in mind that individual health insurance can exclude coverage for pre-existing health conditions and usually do not cover maternity in Texas.

 

For Your Dependents (wife, husband, children) – While an employer

will pay anywhere from half to all of the cost of the employee’s corporate health insurance plan they may not cover the cost of including your spouse and/or children on the plan. Adding a member of your family on your corporate plan can be quite expensive. In this scenario it definitely makes sense to explore individual or family health insurance outside of the corporate plan for your dependent(s).

 

 

Health insurance benefits are typically offered by larger and more established and profitable companies to ensure employees are well taken care of and to reduce employee turnover. If you’re employed by a company that doesn’t yet have the resources to offer group health insurance you may want to cover yourself with Individual or Family Health Insurance. You might even hit your boss up for a monthly allowance for health insurance if you consider yourself of value to the company.

 

 

You are responsible for covering yourself first and then your employees. Obtaining a health insurance policy for you and your family is part of good financial planning and important in ensuring business continuity. In this scenario you should absolutely consider covering yourself with individual or family health insurance first and when the time is right cover your employees with group health insurance.

 

 

When people leave a company, in certain situations, they are often offered, by law, the ability to continue their corporate coverage but at their own expense. This means they will need to pay full price for their plan. This is usually an exorbitant amount that may not make sense to pay if you’re in good health. If you are in good health and are offered COBRA you should absolutely consider obtaining individual/ family health insurance on your own.

 

What are My Options for Individual & Family Health Insurance?

 

Co-pay Plans – This is a very common type of health insurance plan for individuals and families. It has a catastrophic portion to the plan for major medical expenses but also, in many cases, offers co-pays for office visits, medication coverage, and annual preventative benefits. There are usually

some limitations of these plans including separate deductibles for drugs, limitations on preventative care, and some plans will limit the number of available co-pays (i.e. four office visit co-pays per year) and may exclude preventative benefits all together.

 

Catastrophic/Major Medical Plans – These plans are typically lower in cost than co-pay plans because they are generally more profitable for the insurance companies. These plans do not cover any medical expenses (no co-pays, preventative benefits, or medications) until you meet the selected

deductible.

 

Before you consider this type of plan you should also think about the psychological aspects of having this type of plan. You will have to pay for many of your medical expenses, so you could be looking at $100 for a doctor’s visit and full price for your medications.

 

Some feel it’s almost like not having health insurance unless something major happens and it’s relatively rare that people have large medical expenses. Some prefer this but others, especially those with children, might be better off considering a co-pay plan for the co-pays for doctor visits, prescription drugs, and preventive benefits.

 

This type of plan is ideal for someone who is generally healthy and/or doesn’t mind paying out-of-pocket for medical expenses as long as they’re protected for the “catastrophic” medical expenses.

 

HSA Qualified Plans – These plans work much like a catastrophic/major medical plan, but with the option of opening a specific type of financial account (Health Savings Account) in which you can put away pre-tax dollars to cover any out-of-pocket medical expenses. But the majority of people who take these plans either never open the financial account or do but never contribute. So, before you

consider this type of plan, determine if you are OK with paying for upfront medical expenses out-of-pocket or if you feel you would take the time to open the financial account and contribute to it on a regular basis.

 

SCAMS - Stay away from or be concerned about…

 

High Pressure Tactics – A bit of a “no-brainer” but if someone is trying to get you to make a decision immediately without allowing you to see a proposal with details of the plan, or ask for an expensive application fee – STAY AWAY!

 

Common tactics include telemarketers telling people that they have a group plan that the prospect can take part in. but they have to order right then as there are only “x” number of spots left or that the plan has no co-pay and no deductible and allows them to go to any doctor they want.

 

These are typically discount plans that very few medical facilities will accept and are missing the most important parts of an insurance plan. General Rule is if someone wants to charge an application fee and wants you to make a decision right then.  Ask for more details and if they resist excuse yourself politely from the call and try another independent agent!

 

Agents Pushing for dace-to-face Appointments – I realize this might sound counter-intuitive. Why wouldn’t you want to have someone come to your house to go over plans? A good agent will often be willing to sit down with you if you ask. As you might probably guess many agents feel that by meeting with you face-to-face it increases their chance of “closing” before they leave. Many shopper prefer to gather information and digest it before making a decision.

 

Agents that claim they offer a plan that accepts everyone without underwriting – There are a very limited number of situations where individuals are offered a policy without going through a medical underwriting process to determine your coverage ability.

 

If you’re being offered a health plan that an agent claims takes everyone and has no underwriting then you are likely being offered a discount plan and you should consider benefits and network carefully before making your final decision. Do not make an immediate decision – especially if they are asking you to sign up via phone and ask for payment and a pricey application fee.

 

If you are a part of a group (i.e. corporate, association, franchise, unions) you might be offered a plan that does not exclude you due to pre-existing conditions. Even with these plans you should consider benefits and limitation carefully before you make a decision. You should be especially careful if the agent is pressuring you to make an immediate decision via phone without providing you with plan details and requiring a high “application” or “enrollment” fee.

 

If it sounds to good to be true or you’re being pressured to make an immediate decision or are asked to pay a high application fee or are told it is guaranteed issue without having to go through underwriting or are being propositioned for a face-to-face pitch – you should have your guard up and fully understand what you’re getting into before making an immediate decision.

 

Top 10 Things to Consider in a Health Insurance Plan

 

1) Maximum Out-of-pocket (AKA Coinsurance Maximum, AKA Stop Loss)

 

This is the dollar amount that indicates the most you could spend on medical expenses in-network and out-of-network within the calendar year should something catastrophic happen. This dollar amount consists of the deductible and coinsurance limit.

 

2) Lifetime Maximum (No Annual Maximums)

 

Most companies have adequate lifetime maximums which is the maximum they will pay for medical expenses during your life as long as you’re on the policy.

 

A $3 million or higher lifetime maximum should be sufficient.

 

BE CAREFUL - Some plans might also have per incident or per year maximums that supersede the lifetime maximums.

 

3) Price

 

We all have budgets. Once you have determined what type of plan makes most sense for your situation and preferences you should comparison shop. A good independent agent can help you quickly shop apples-to-apples between the major insurance providers. You can also use online quoting and comparison systems provided by many agent/broker’s websites.

 

You may find huge differences in pricing for comparable plans offered by different companies. No one insurance company will always be the low cost insurer for every situation and for every time period… This year’s lowest, could well be next year’s highest.

 

4) Network

 

The two main types of networks for individual & family plans in Texas are HMO and PPO.

 

HMO (Health Maintenance Organizations) - HMO’s can offer better benefits for comparable pricing to a PPO. What you might give up in return is freedom to go to any doctor you would like at anytime and often have to get referred to specialists, etc.

 

PPO (Preferred Provider Organizations) - These networks are typically much larger than the HMO networks and allow you to go to any doctor you would like but the insurance company will pay more if you go to one of the medical facilities that will take that particular insurance company.

 

5) Reputation

 

Research the company. Check the Texas Department of Insurance (TDI) website and check a search engine using the name of the insurance company and the word “complaint” or “scam” or “ripoff”. Every insurance company has complaints against them but you can determine the serious violators pretty easily with a little research. Part of the reason people complain about insurance (other than price and coverage) is that they do not understand how their coverage works when they first buy and think the insurance company is not paying what they should. A good independent agent will always ensure you fully understand the benefits and limitations of your chosen plan.

 

6) Underwriting

 

Waivers, riders, exclusions, rate increases, declines – Each insurance company has different underwriting policies and this could be a top three most important factor in some cases. If you have asthma, you might find one company would decline you, another might cover you but not the asthma, yet another might just charge more, but cover you and the condition. It should be obvious which company would be the best to choose. Your independent agent should be able to determine these things before you even apply.

 

Being Declined/ Ineligible - You might find that you are not eligible for coverage from any of the individual health insurance companies due to your pre-existing condition(s) and treatments. First off, don’t think that this means the underwriters think you’re on your death bed.

 

Their decision is not based on mortality but on whether or not they have a likelihood of being profitable. If you take multiple medications or have a possibility of needing surgery or other expensive treatments you could be declined by one or all of the individual health insurance companies.

 

The State of Texas has made health insurance available to individuals who are otherwise declined by insurance companies or don’t have other means for getting covered. You can visit the Texas Health Insurance Risk Pool at www.txhealthpool.org for coverage options and associated pricing.

 

Waiver/Riders/Exclusions – In considering your medical history, many insurance companies consider the option of placing a waiver, rider, or exclusion on coverage of a pre-existing condition. These terms essentially mean that they will not cover medical expenses related to the waivered, ridered, or excluded pre existing condition.

 

Rate Increases – Underwriting departments responsibility is to understand an applicant’s pre-existing condition(s) and determine if they can be approved with or without an exclusion. In order to increase the chances of being profitable an insurance company may increase the “preferred” rate on your policy during the initial underwriting (only) to cover likely medical expenses for any preexisting condition. Once you have been approved for coverage an insurance company can not single you out for a rate increase.

 

7) Drug Coverage

 

Many plans have a drug deductible before you can pay co-pays for medications. They may also have a maximum allowable – If you prefer a plan with drug co-pays there are a few important things to consider.

 

a. Drug Deductible – some companies’ drug benefits may have some type of drug deductible. Some have an overall drug deductible for each person applying meaning you will have to spend that much on medications before you can pay co-pays for generic or name brand drugs. Others only apply the drug deductible to name brand drugs so you can pay a co-pay from the start for generic medications. This is helpful since many medications have generic alternatives.

 

b. Annual Maximum – Many policies are going to have a limit on the retail value of outpatient medications they will cover per year.

 

8) Preventive (Wellness) Benefits

 

Many co-pay plans (not all) will have some level of preventative benefits. Many times these plans have a dollar limit to be used toward preventative benefits. And many of the plans limit the benefit to specified procedures such as…

 

a. Women – benefits can be used to cover cost of pap smears and after a certain age (or younger if family history) mammography’s for women. Any blood work or other routine labs or tests are typically out-of-pocket.

 

b. Men – the benefit might be limited to PSA (prostate screening) tests and colorectal screenings and at older ages could help pay for such things as a colonoscopy.

 

9) Office Visit Co-Pays

 

Many co-pays are relatively low so this feature shouldn’t be a primary deciding factor in your decision. However, when considering co-pay plans understand that some may limit the number of office visits (typically 2 to 4) with co-pays and not subject to the overall plan deductible.

 

10) Financial Rating

 

Ability to pay claims is very important and a company’s financial rating is the primary indicator of the insurance company’s ability to pay. Companies with an A+, A, or A- A.M Best rating should be your preferred choice.

 

 

How to Search for the Best Plan

 

Online Quoting Systems – You can get pricing for most plans offered in Texas online from many agent/broker websites including ours at www.eSureTexas.com. Websites such as ours will show you plans and the associated preferred pricing from most of the major insurance providers.

 

Some things to understand as you’re reviewing pricing:

 

 

 

Working with a good insurance agent/broker can ensure you make the best decision –An honest and experienced independent agent can help you make a decision on the best plan or help validate your thoughts on plans. The surprising thing to many people is that, by law, there are NO FEES of any type to work with an independent agent. A good independent agent will also help with any issues, changes, re-evaluations, or other matters, through the life of the plan

 

Frequently Asked Questions (FAQs)

 

Q. Can I buy health insurance for less if I deal directly with an insurance company?

A. No. Health insurance rates for the same plan will be the same whether you use an independent health insurance agent or deal directly with the insurance company offering the plan.

 

Q. Must I pay a fee to an independent health insurance agent?

A. No. An independent health insurance agent is paid a commission by the health insurance company. No additional fees are added to your health insurance cost

 

Q. I have previous group health insurance coverage. Does this mean the health insurance company must accept my application and apply no pre-existing condition limitations?

A. No. In Texas it does not matter that you have previous group health insurance coverage. A health insurance company can still deny your application for individual or family coverage. However, if your application is declined, you may be eligible to participate in the Texas Health Risk Pool (www.txhealthpool.org) established for persons who are unable to obtain health insurance coverage

on the open market.

 

Q. What are my options if I my application for coverage is denied?

It depends on the specific health condition(s) at issue. If you are denied coverage by one company for medical underwriting reasons you can apply to another health insurance company. Different insurance companies use different underwriting guidelines. You may obtain coverage with another provider who may have more lenient guidelines for the same pre-existing condition(s). Also, if a health insurance company declines to cover you, you may qualify for enrollment in the Texas Health Risk Pool (www.txhealthpool.org).

 

Q. Can my health insurance be terminated for any reason?

A. Texas provides strong consumer protection. In general, once you have been approved for coverage, the insurance company can terminate your coverage for only the following reasons: (1) failure to make premium payment within the payment grace period, (2) material omission or misrepresentation on your health insurance application, or (3) the insurance company becomes insolvent or bankrupt.

 

Q. What are "pooled" health insurance rates?

A. Pooling is a common and, in our opinion, the fairest approach to setting health insurance rates. A health insurance company operating under a pure "pooled" approach uses the same method in determining rates for both new and existing clients, regardless of the client's health status or claims history. In other words, insurance companies with "pooled" rates do not charge lower rates to entice

new customers, while charging higher rates to long-time customers. This issue has very important implications for people intending to be enrolled in a health insurance plan for more than a year.

 

Q. Under a new health insurance plan, can I keep my doctor?

A. You should review a health insurance plan's physician network before applying to the plan. Each insurance provider has different network restrictions. PPO plans, for example, may allow you to visit any doctor but will offer better benefits if you use a provider within their network. HMOs might not provide benefits outside of their doctors network except in emergency situations where a network doctor is not available.

 

Q. Are there meaningful differences in how insurance companies underwrite health insurance applications?

A. Yes. For example, one insurance company assigns "preferred" rates to a 5'10" male who weighs 215 pounds. Another insurance company would assess an additional 40% charge for this person. One insurance company charges an additional 40% for smokers. Another charges an additional 25%. One might not charge a rate increase at all. There are many distinctions such as these. To get the best health insurance value for your own situation, you need the advice of a good health insurance agent.

 

Q. What is health insurance trend (medical inflation)?

A. Health insurance trend is an annual percentage increase in health insurance claim costs. The two primary components of health insurance trend are (1) inflation of costs physicians and hospitals charge for health care services and (2) increases in the average utilization of these services.

 

Q. How do PPO plans and HMO plans differ?

A. The primary difference is that HMOs limit your non-emergency health care coverage to a limited network of physicians and hospitals. PPO plans insure covered services delivered by any licensed physician or hospital, though a PPO plan will offer improved benefits if you use physicians and hospitals participating in the PPO's preferred network. PPO networks are normally much larger than HMO networks, though HMOs provide higher benefit levels. For many individuals and families in Texas, PPO rates will be lower than HMO rates. In addition, HMO plans are rarely an option for persons not participating in employer-sponsored

programs. The large majority of our individual and family health insurance clients enroll in PPO plans.

 

Q. How long does it take to enroll in a health insurance plan?

A. It depends on the health status of the applicant and the health insurance company to which the applicant applies. Some health insurance companies may approve, within a few days, the application of a healthy young adult. However, for less healthy or older applicants, processing of an application can take several weeks or more. Each circumstance is different. You should consult your

independent health insurance agent to get a realistic expectation.

 

Q. Can my health insurance application be denied?

A. Yes. Whether an application is approved or denied depends on the applicant's health and the underwriting guidelines of the insurance company. Contact your independent health insurance agent to get a realistic assessment regarding your own circumstance.

 

Q. Why should I use an independent health insurance agent?

A. Because he/she is not an employee of an insurance company, the independent agent can more objectively recommend the best health insurance company for your situation. In addition, an independent agent will be familiar with insurance company bureaucracies, which can save you a lot of aggravation. Further, if your circumstances change, an independent health insurance agent can recommend a more appropriate health insurance plan for you.

 

Q. How do health insurance companies define "pre-existing condition?"

A. Each health insurance company has its own specific wording. However, the following statement is in line with many insurance company provisions: Preexisting condition means the existence of symptoms which would cause an ordinarily prudent person to seek diagnosis, care or treatment within a five year period preceding the effective date of the coverage of the insured person or a condition for which medical advice or treatment was recommended by a physician or received from a physician within a five year period preceding the effective date of the coverage or the insured person.

 

Q. Do I have to take a physical exam in order to obtain health insurance coverage?

A. The health insurance companies represented by Texas Health & Life rarely require physical exams. The exceptions usually involve applicants who have not consulted a physician in the last couple years.

 

Q. What are the options for making my initial health insurance premium payment?

A. An initial payment (usually one month of insurance premium) is required with your health insurance application. Checks, money orders, credit or debit cards are usually acceptable. Health insurance companies will not accept cash. Online applications, now the norm, do not require hard copy payment. The first month’s premium is withdrawn from your designated bank account or your designated charge/debit card account.

 

Q. I am pregnant. Can I obtain health insurance?

A. No insurance company underwriting individual or family health coverage will agree to insure you while you are pregnant. However, group health insurance plans will accept new enrollees who are pregnant. So, if you are pregnant and have an opportunity to enroll in a group health insurance plan, take advantage. Otherwise, you may wish to look into the Texas Health Risk Pool or Medicaid if you have a low income.

 

Q. Will a new health insurance policy cover my pre-existing condition?

A. Many individual and family health insurance policies limit coverage for pre-existing conditions during the first nine to twelve months of coverage – sometimes longer. However, the pre-existing condition exclusion period is waived to the extent that the applicant has "qualifying" prior group coverage. This is a government-mandated requirement, though the health insurance company can still deny the application of someone whose health does not meet the insurance company's underwriting requirements. However, the insurance company can still waive coverage of the condition altogether rather than outright decline coverage. In the absence of prior group coverage, some health insurance companies will waive their pre-existing condition exclusion for any health conditions listed on the application. Many HMO plans do not have pre-existing condition exclusions, though HMO coverage is rarely available to people not participating in employer-sponsored plans. In addition, when such HMO coverage is available, the rates tend to be quite high or the HMO can decline coverage all together. You should fully discuss your pre-existing conditions with your independent health insurance agent before you submit a health insurance application

 

Q. Will this website keep my personal information private?

A. Yes. What little personal information you may volunteer while visiting this website will not be distributed to any outside organizations -- including health insurance companies.

 

Q. Do my health insurance premiums increase as I get older?

A. Yes. Health insurance companies providing individual coverage can charge higher rates to older persons and lower rates to younger persons. For example, the health insurance rate charged to a 50- year-old can be more than twice the health insurance rate charged to a 25-year-old.

 

Q. Can my weight make a difference in my health insurance rates?

A. Yes. All Texas health insurers use height/weight tables to make risk determinations. People with "non-standard" height/weight ratios may be charged higher rates or refused coverage. These height/weight standards vary from health insurer to health insurer.

 

Q. For how long am I committed to keep any health insurance I purchase?

A. Health insurance is generally purchased in one month increments, so your commitment is typically one month at a time. If you stop making health insurance payments, the insurance company will simply terminate your coverage.