Hospital health insurance coverage, a type of catastrophic plan, is an inexpensive way to provide major medical benefits for individuals and families. Rates are substantially lower than comprehensive plans, and this type of policy continues to grow in popularity on State and Federal Exchanges and Marketplaces. Often the savings in premium is thousands of dollars per year (per family), which can easily and effectively be used to offset lack of non-preventive office visit benefits and most prescriptions. Indemnity policies are also offered to help offset medical expenses.
The financial protection received from these types of policies is often quite substantial and helps avoid bankruptcy and large debt. Qualified ACA plans have no waiting periods or limitations on covered benefits. Although deductibles and maximum out-of-pocket expenses can vary, unlimited hospital visits are permitted throughout the year. Deductibles are also calculated per calendar year instead of per incident, which can potentially save thousands of dollars. This applies to HMO, PPO, EPO, and POS plans.
ACA Legislation (Obamacare)
The passage of “The Affordable Care Act” has made many of these options more popular than ever before. Why? Because although many policies are purchased through State Health Insurance Exchange programs, many families and individuals now choose to buy coverage “outside” the Exchange, where rates may be less, since higher deductibles, and higher maximum out-of-pocket expenses are available. However, there are several disadvantages, which may sometimes include pre-existing conditions not fully covered, preventative expenses not provided with no out-of-pocket expenses, and not being classified as a “compliant” plan. And depending on the state, coverage may only be available for 12 months or less.
For example, the least expensive Marketplace option is a “Bronze” plan, which has a maximum out-of-pocket maximum (MOP) of $8,700. Although deductibles may be less (perhaps $3,000, $4,000, or $5,000 for the Silver-Tier), your MOP is typically much higher, unless the policy has 0% coinsurance. If there are no medical conditions present (or expected), the Bronze-Tier options always should be considered. NOTE: Federal subsidies are offered with Bronze-tier contracts. “Catastrophic” plans are also offered to persons under age 30, but without federal subsidies. Often, a Bronze-tier plan is a more effective option that a catastrophic-tier plan.
Additional compliant options are offered by major insurers away from the Exchange. Often referred to as ACA “off-Exchange” contracts, these specific policies will allow you to select several available deductibles and out-of-pocket expense maximums. Pre-existing conditions are still covered and they are also GI (guaranteed approval). Maternity, mental health, ER, and other traditional benefits are included. The network of physicians and hospitals is also the same as ACA-qualified plans.
These “away” or “outside” plans are ideal for single or family situations where the household income excludes eligibility for the federal subsidy. Using Charlotte as an example, in a family of two (ages 45), household income of about $152,000 excludes federal aid for State Exchange coverage. If there are four family members, the threshold raises to approximately $240,000. A family of six raises the limit to about $295,000. Each county may have different limits.
Catastrophic-Tier Marketplace Plans – They’re Cheap!
However, if you are under the age of 30, you can purchase a special non-Metal policy, appropriately referred to as a “catastrophic” option. If you qualify for a financial hardship exemption, you can also buy this policy. The White House also made a significant change in the law when they announced in seven years ago that persons that had their policies canceled could now buy catastrophic contracts.
Since they are not considered Platinum, Gold, Silver, or Bronze-tier contracts, as previously mentioned, regardless of your household income, you will not receive financial assistance. Therefore, most expenses, whether they are inpatient or outpatient, will have to meet a high deductible before being payed by the carrier. However, some plans may offer copays on up to three primary-care physician visits each year. Generic prescriptions may also be subject to only a copay.
Online virtual office visits may also be included with a $0 copay. Telemed coverage is now included on most Marketplace plans, and often the deductible and coinsurance are waived. Utilizing technology to communicate via phone calls, emails, live video, and text messages has substantially increased access to health care for many persons.
Preventative visits and related-expenses are always covered at 100%. Three separate sets of benefits are offered for children, women, and adults. Several of the most popular and useful benefits that can be utilized include routine annual physicals, OBGYN visits, blood pressure, cholesterol, depression, diabetes, obesity, lung cancer, and tobacco use screening, STI counseling, contraception, immunization vaccines, and alcohol counseling.
Additional children’s benefits include autism, developmental, hearing, HIV, lead, and vision screening, alcohol and drug use assessments, fluoride supplements, BMI measurements, and iron supplements. NOTE: Many employers offer a supplementary Aflac policy that helps cover many of the out-of-pocket expenses that basic plans do not cover. However, these policies are only offered as payroll-deduction through your workplace.
We’re one of the nation’s best shopping website for hospital health insurance plans. We help you view the lowest available rates from the most respected carriers such as Aetna, UnitedHealthCare, Blue Cross Blue Shield, Cigna, Humana, Kaiser, and many other companies. Within minutes, you can see live quotes and apply for immediate coverage. We feel it’s important to be able to talk to a live experienced broker instead of receiving pre-programmed emails in response to your questions.
What Do Hospital Plans Cover?
Typically, hospital plans cover most expenses of confinement. Some of these inpatient expenses include (but are not limited to) daily hospital room charges at the semi-private rate, intensive care costs, drugs, medicine and other important medical supplies, stated fees of doctors and surgeons, costs of operating, recovery and treatment rooms for surgery, and radiation treatment or chemotherapy treatment. There is no annual or lifetime limit for medical expenses paid from Exchange or Marketplace plans.
Additional inpatient covered benefits include ground ambulance service to the nearest hospital, and administration of blood and artificial limbs. Of course, there may be variations in policy benefits when comparing plans from different companies. Also, if you move from one state to another, you may notice a change in benefits since state mandated requirements do vary. For example, levels of maternity or mental illness coverage are often different in each state, even though it is a mandatory Obamacare requirement.
Senior Medicare Advantage plans often have different copays for inpatient and outpatient treatment. Many carriers do not offer plans in all states or all counties of a specific state. “Dual” plans provide coverage for persons eligible for both Medicare and Medicaid.
Make Certain Your Hospital Is “In-Network”
Another concern that started when the ACA was passed, is the importance of verifying that your facility is accepted by your individual or group health insurance provider. For example, in many parts of Ohio, the Cleveland Clinic is considered the facility “of choice” if major surgery is needed. Yet, few carriers (Oscar is one example) classify them as “in network.” We’ll help you research local provider lists in your area since other major hospitals across the country may be excluded from many new policies. Balance billing (surprise billing) is also a concern when your hospital bill is higher than anticipated because the services charged are higher than the insurer will pay.
Treatment of cancer and heart disease often require extremely specialized treatment that may not be local. Also, many children’s serious illness and injuries are best treated at top-rated hospitals, such as Boston Children’s Hospital. Programs and services are offered at these types of facilities, that may not be available in your area. Thus, it’s important to understand the range of your network facilities.
Many hospital health insurance policies also provide outpatient expense coverage. Some of the more common items covered are CAT scans, MRIs, hospital emergency room expenses for illness or injury, prescription drugs related to possible organ rejection, and typical outpatient facility charges. The percentage of surgeries that are now done on an outpatient basis are increasing (every year), so it is always a good idea to closely examine this portion of your policy.
Fixed Indemnity Coverage
Fixed Indemnity policies can be purchased through selected carriers including UnitedHealthcare. Benefits are fairly limited, so this type of plan should not be expected to cover a large percentage of your expenses. For example, if you were hospitalized for 10 days and had surgery and multiple procedures, there would likely be a cap on how much of the hospital bill would be paid by the insurer. There could also be other gaps, including coverage for supplies, length of stay, and types of prescribed medications.
Since it is often considered a “supplementary” form of coverage, a fixed cash benefit may be payable for approved illnesses and injuries. Generally, there is no deductible or copay to meet, and you can visit any doctor, hospital, or other medical facility. Also, unlike conventional policies, applications are not guaranteed to be approved. Premiums can increase each year and plan availability will vary by state. Since they are not considered major medical coverage, the predetermined fixed benefit may not pay the entire medical bill.
Usually, this type of policy does not meet the Affordable Care Act requirements since it does not contain the 10 “essential health benefits” (minimum essential coverage). Therefore, although this option may be inexpensive, you must take into account the noncompliance tax of 2.5% of household income. But if the tax is substantially cheaper than the cost of a compliant policy, you may have an interesting decision to make.
For example, if the cost of a gallbladder surgery was about $12,000, the Fixed Indemnity policy might pay for $5,000 of the expenses, (or less) leaving a large balance for the policyholder. Some of the gaps would be paying surgeon and anesthesiologist fees, pathology expenses, ultrasounds and blood work. However, a conventional policy, depending on benefits, may cover $8,000 to $11,500 of that amount.
If You Miss The Open Enrollment Deadline
If you missed Open Enrollment, a limited-benefit plan should be considered until you are eligible for the next enrollment period. It will be within 12 months , so you would not have to keep the “limited” policy long. Just beware of potential situations where, for example, all of an anesthesia charge is not covered, or only a specific number of days of your facility stay would be covered. “Limited-Benefit” plans should only be considered if most/all other options are either not affordable or not available.
With recent national healthcare reform changes, insurers include preventive benefits in their catastrophic health care plans. Generally, there is no waiting period, deductible or coinsurance to use these benefits. Typical preventive coverage includes annual routine physicals, well-child visits, pneumonia and flu shots, vaccines for diseases, blood pressure, cholesterol and diabetes screenings, mammograms, pap smears, and prostate cancer screenings.
Prior to 2011, many companies required waiting periods or copays before allowing policyholders to use these coverages. But that situation changed. Now, when you purchase a “bare-bones” or “catastrophic” plan, you are rewarded with rich preventive benefits that will be covered without any out-of-pocket expense. If you need a colonoscopy, despite their cost, it will be fully covered unless removal of polyps is required.
In those situations, you may have to pay for that specific charge, since they are considered diagnostic. The same treatment applies to a routine annual mammogram. Initially, 100% of the cost is covered. However, if more imaging is needed, the extra cost (about $250-$500) will be considered “diagnostic,” and may not be fully covered. However, once your deductible and maximum out-of-pocket expenses have been met, any additional procedures or surgeries should be 100% paid by the carrier.
Temporary Medical Coverage
If the need for hospital coverage is less than 12 months, a temporary medical plan might be the best option. Although pre-existing conditions and preventive benefits are not covered, premiums are extremely inexpensive, often 50% less than a standard copay policy. This type of policy is best suited for persons that are between jobs, waiting for a policy to begin, graduating high school or college students or seasonal employees. However, they do not meet the ACA required mandated coverage.
Applications are normally approved within a few days and consist of very few medical questions. Often, it takes less than 25 minutes to view a quote and apply for coverage. But usually you can only apply to renew coverage one time with each company. And since the policies are not considered “qualified” by the government, the special tax could will be imposed for the months you do not have “qualified” coverage. But, unlike conventional plans, you can also buy temporary benefits after Open Enrollment periods have expired.
The section at the top of the page allows you to easily view and compare quotes from the most respected carriers. If you choose to apply for a policy, free assistance will be available. Enrollment for Exchange coverage takes place during specific times of the year. However, other hospital plans are available at any time, including short-term policies.
Additional Information: Bronze “Metal” plans continue as one of the cheapest catastrophic health insurance plans offered on Exchanges. Although the potential out-of-pocket costs are the highest, for healthy persons that don’t want overpay for benefits, and frugal families that desire to keep premiums as low as possible, it’s an ideal option. However, if your household income allows you to take advantage and qualify for “cost-sharing” (Silver-tier plans only), a Bronze-tier option may not be the best choice.