When Denny Marshall needed knee surgery, he made sure he knew how his individual health insurance plan worked.
Instead of trusting a Web site or network directory, he called his hospital and surgeon to make sure they were still in his provider network. He pre-certified the procedure with his insurance company, and even checked the pharmacy list to see which painkillers would be covered by a copayment.
The former Denison University basketball standout headed into surgery without a second thought.
But the anesthesiologist bill presented a problem. On top of his plan deductible, Marshall got hit with a $500 penalty for seeing a non-network provider--even though he had no choice in who administered his anesthesiology.
More and more health care consumers are falling victim to balance billing, an unfortunate consequence of forced provider care. Someone like Marshall verifies his procedure is covered, chooses a network hospital and then assumes all of his treatment there will be billed the same. While any type of a health plan might be subject to balance billing, adding an additional out-of-pocket to a high-deductible health plan can wreak havoc with a consumer's health care budget.
Unfortunately for consumers, hospital-based physicians often opt out of provider networks and instead bill on their own--at their own rate scale. Since many hospital-based physicians are employed by physicians groups, they might be unable to independently decide to join a specific provider network. And since consumers rarely are allowed to choose their anesthesiologists, radiologists or ER physicians, they wind up in an unfortunate situation like Marshall's.
Agents and brokers should proactively address what potential clients might consider "gotchas" in order to help them understand the plan before they buy.
A growing number of carriers have added forced-provider provisions to their contracts, but many still penalize clients for seeing non-network providers. While most carriers still subject the claims from non-network providers to reasonable and customary limits, they do not impose out-of-network penalties. Some clients are willing to risk out-of-network claims for forced providers; others are not.
Regardless, they should be given the opportunity to make that decision when they purchase the policy, not at the time of claim.
Some carriers impose pre-existing condition restrictions on individual medical policies. This impacts both large claims and smaller claims for "everyday" health care expenses. For example, customers need to know if their medication will be covered during the pre-existing condition limitation period so they can factor that into their purchase decision. Saving $20 a month on an insurance premium is pointless if it means paying an additional $50 a month the first year because a prescription is considered pre-existing.
What's more troublesome is if the carrier considers a large, seemingly unrelated claim to be pre-existing. If a client has high blood pressure and then has a heart attack during the pre-existing period, will the blood pressure be considered a complicating factor that can negate the claim?
In the individual market, many carriers impose a six- or 12-month waiting period before wellness claims are covered. This means clients may need to alter their regular wellness schedule to avoid rejected claims.
Agents and consumers should also be aware how wellness expenses are covered after the annual first-dollar coverage limit is reached. Some individual health plans allow excess claims to go toward the plan deductible and co-insurance, which accommodates higher cost wellness procedures such as colonoscopies.
Agents will benefit greatly from understanding the inherent differences between individual products. By guarding against potential misunderstandings in advance, they can significantly reduce their chances of losing a client over a negative claim.
Dave Keller is senior vice president of IHC Health Solutions, a member of the IHC Groups. He can be reached at Dave.Keller@thinkIHC.com or (952) 746-6614, or go to www.ihcgroup.com.
