NJDPA INSURANCE GUIDE

NJDPA Insurance Guide

PatientMemberButton-01-300.jpgYou probably pay a lot of money each month for health insurance, so it is important to know what you are TRULY getting from this huge personal expense. The New Jersey Doctor-Patient Alliance wants to help you, our members, make the most educated choices when it comes to purchasing health insurance plans.

In terms of health insurance, one size does not fit all. Please know that there are no health insurance plans available that will cover 100 percent of services for any doctor, let alone a quality doctor. Some plans may restrict your access and choice of physicians more than others. Likewise, some plans will shift significantly more out-of-pocket costs onto patients in the form of high deductibles and co-insurance. 

Below is a brief overview of common plans offered in today’s health insurance marketplace.

1. Point-of-Service Plan/Preferred Provider Organization

PPO stands for "Preferred Provider Organization” plan. These plans provide much more flexibility and coverage when choosing a doctor or hospital. They also provide in-network AND out-of-network benefits. Please note that recently some PPO plans don’t offer out-of-network benefits, so please be diligent about verifying these details before choosing your plan.

PPO plans are generally more expensive than POS (Point-of-Service) plans because they have more expansive options for care. But you have to verify that you are getting what you pay for. Health insurance carriers have drastically “gutted” out-of-network benefits, often unbeknownst to consumers and even seasoned insurance brokers. Insurance carriers do this by capping the amount they will pay for out-of-network services, regardless of the charged amount, at a low multiple of the federal Medicare reimbursement rate (e.g. 110% of Medicare). A Medicare rate usually only covers a small portion of an out-of-network medical bill.

Unfortunately, many PPOs have adopted this subtle but significant change to their out-of-network benefit plans amounting to a bait-and-switch for consumers. This could leave you (the consumer AND the patient) with a meaningless out-of-network benefit, and unknowingly responsible for the majority of a large medical bill.

Here are some key features:

  PPO HMO
Access to a network of doctors, hospitals and other healthcare providers
Ability to see the doctor you want without a Primary Care Physician (PCP) to authorize treatment  
Referral from a PCP not needed to see a specialist  
Low or no deductible and generally lower premiums  
Coverage for medical expenses outside the plan’s network  

2. Exclusive Provider Organization (EXTREMELY LIMITED PHYSICIAN ACCESS)

EPO stands for "Exclusive Provider Organization" plan. These plans are true “narrow network” plans, which means the available doctor network is small, and your choices to a physician of your choosing is limited. As a member of an EPO you can ONLY use the doctors and hospitals within the EPO network; you cannot go outside this network for elective care, and there are no out-of-network benefits. It is considered to be more of a catastrophic plan that will restrict your options for elective healthcare.

3. Health Maintenance Organization (LIMITED PHYSICIAN ACCESS)

HMO stands for “Health Maintenance Organization.” This type of health insurance plan usually limits coverage to care from doctors who work for or contract with the HMO. HMOs generally do not cover out-of-network healthcare expenses except in an emergency. An HMO may require you to live or work in its service area to be eligible for coverage (i.e. you might not be able to go to NYC/PA/CT to receive non-emergent care from specialists such as an oncologist, heart surgeon, or spine surgeon).

4. OMNIA (LIMITED PHYSICIAN ACCESS)

OMNIA_featured_image-969x520.jpgLike the traditional HMO, OMNIA Health Plan members are restricted to using physicians and other health care professionals who participate in the Horizon Managed Care Network and hospitals in the Horizon Hospital Network. OMNIA Health Plans do not include out-of-network benefits. Additionally, OMNIA divides their doctors and hospitals into Tier 1 and Tier 2. Recently released insider documents have shown that quality alone only played a small part in dictating the tier status of a doctor or hospital, often times overshadowed by considerations not in the best interests of patient care. That said, if you see the best in-network Tier 2 doctor, your deductible could be as much as $5000 and you may have to pay up to 50% of the remainder of billed charges for that service.

OMNIA Health Plans

We used Horizon insurance plans as examples of common plans, since Horizon is one of the largest health insurers in the state of New Jersey. Please check with your plan regarding medical insurance coverage.

Things to consider about tiered-network plans:

  • How likely are you to use providers in the lowest cost tier?
  • Are there enough specialists in the lowest cost tier?
  • While there are great cost savings associated with the use of Tier 1 providers, these benefits are only realized IF you actually use only Tier 1 providers.
  • Recently it was learned that Horizon chose the tiers of their network doctors and hospitals based on criteria that had little to do with quality, and nothing to do with cost, so a Tier 1 doctor is not necessarily the best doctor for your needs (Advance Media / Study link).

OMNIA Plan Details

OMNIA BRONZE

  • No out-of-network benefits
  • Lowest monthly premium and highest out-of-pocket costs compared to other OMNIA Health Plans. Members must use physicians and other health care professionals who participate in the Horizon Managed Care Network and hospitals in the Horizon Hospital Network, except in cases of medical emergencies.
  • Bronze plans, on average, pay for 60 percent of the covered medical expenses in Tier 2; members pay 40 percent.

OMNIA SILVER

  • No out-of network benefits
  • Mid-level monthly premium and out-of-pocket costs compared to other OMNIA Health Plans. Members must use physicians and other health care professionals who participate in the Horizon Managed Care Network and hospitals in the Horizon Hospital Network, except in cases of medical emergencies.
  • Silver plans, on average, pay for 70 percent of the covered medical expenses in Tier 2; members pay 30 percent.

OMNIA SILVER HSA

  • No out-of-network benefits
  • Mid-level monthly premium and out-of-pocket costs compared to other OMNIA Health Plans.
  • Members must use physicians and other health care professionals who participate in the Horizon Managed Care Network and hospitals in the Horizon Hospital Network except in cases of medical emergencies.
  • Silver plans, on average, pay for 70 percent of the covered medical expenses in Tier 2; members pay 30 percent.

OMNIA GOLD

  • No out-of-network benefits
  • Higher monthly premium and lower out-of-pocket costs compared to other OMNIA Health Plans. Members must use physicians and other health care professionals who participate in the Horizon Managed Care Network and hospitals in the Horizon Hospital Network except in cases of medical emergencies.
  • Gold plans, on average, pay for 80 percent of the covered medical expenses in Tier 2; members pay 20 percent.

TERM DEFINITIONS

Premium - An insurance premium is the amount of money that an individual or business must pay for an insurance policy. The insurance premium is considered income by the insurance company once it is earned, and also represents a liability in that the insurer must provide coverage for claims being made against the policy.

Cost Sharing - In addition to your premium costs, the term “cost sharing” refers to the amount that your health plan expects you to pay out of your own pocket for medical services. Most plans do this by setting rates for copayment, deductible, and coinsurance for any given covered medical service.

Deductible - In an insurance policy, the deductible is the amount of expenses that must be paid out of pocket before an insurer will pay any expense. In general usage, the term deductible may be used to describe one of several types of clauses that are used by insurance companies as a threshold for policy payments.

Co-insurance - Co-insurance is the amount, generally expressed as a fixed percentage, an insured must pay against a claim after the deductible is satisfied. In health insurance, a co-insurance provision is similar to a co-payment provision, except co-pays require the insured to pay a set dollar amount at the time of the service.

QuestionMarks.pngQUESTIONS TO ASK YOURSELF BEFORE SELECTING A PLAN:

How many times a year do you and your family go to your primary care provider (PCP) for sick visits?

Now, check out the cost sharing for PCP visits under the plan you are considering. Wellness or preventive visits typically have no cost sharing. Next, look at the cost sharing for non‐preventive services (i.e. certain bloodwork and labs, imaging and other diagnostic testing). Are copayments required for each visit? Do deductibles and/or coinsurances apply?

Do you visit specialists? If yes, how many visits per year?

Does a given plan require co-payments for each visit to an in-network specialist? How much are the deductibles and/or coinsurances for each visit or procedure? For example, if you have a medical condition that may require you to see different specialists several times a year, take a look at how co-pays, deductibles, and co-insurances apply to those specialist services. For example, if a covered family member has the misfortune of breaking her wrist and getting a concussion after a fall, she may need to see more than one specialist multiple times, such as orthopedists, neurologists, physical therapists, chiropractors and/or acupuncturists.

How much will prescription drugs cost?

This one is harder to estimate because many plans have different cost sharing depending on whether the drug is considered to be “preferred” (formulary) or “non‐preferred” (non-formulary). You can call the company or visit the company’s website to find out whether your drugs are in the lowest cost tier or not. Some plans include a limit on how much you have to pay for each prescription.

How do I know if I have a “real” out-of-network benefit?

Make sure you ask your insurance salesperson or representative this question: “At what rate does the out-of-network doctor get reimbursed for this plan?” A good out-of-network policy will reimburse at something called “usual, customary, and reasonable” or UCR for short. A poor out-of-network policy will reimburse at a multiple of Medicare, such as 150% of Medicare. If an out-of-network benefit will only reimburse a doctor at this low amount, you are potentially going to be liable for the rest of the bill, hence the term “surprise bill,” particularly if it turns out OON benefit isn’t much of a benefit after all.

UNDERSTANDING IN-NETWORK VERSUS OUT-OF-NETWORK PLANS

Insurance companies DO NOT want you to use your Out-of-Network Benefits even though you are paying top dollar for them. They often do this by using a few different scare tactics.

  • Calling the patient before services to tell them they will incur extremely high costs
  • Sending patients letters that insurance will not cover medical services
  • Reimbursing doctors at Medicare rates, which causes the patient to incur the difference in the amount billed and the low amount that the insurance company paid.

Please note that in accordance with federal safe harbor laws, doctors are permitted, on a case-by-case basis, to discount enormous cost-sharing burdens, when you, as a patient, has a claim of financial hardship. Providers of the NJDPA will always work with our patients so that we can continue to provide high quality care at fair health costs. We care about our patients first and foremost.

Your medical care should be a decision between you and your physician.

The New Jersey Doctor-Patient Alliance strongly opposes efforts by insurance companies to act as your doctor by denying care, often against the judgement and expertise of your own doctor, the trained medical professional, and the only one who has actually seen you person, examined you, and made recommendations for what is in the best interest of your health.

We are here to empower you to ask questions so that you can have a full understanding of your benefits and make the best decisions in you and your loved ones’ health care.

If you have questions about your insurance policy or are having trouble with your insurance carrier, please fill out this form and one of our representatives will answer your questions.

References:

https://www.ehealthinsurance.com/health-plans/epo

https://www.healthcare.gov

https://www.horizonblue.com/providers/products-programs/products/omnia-health-plans

http://www.state.nj.us/dobi/division_insurance/ihcseh/whichindividualplanbest/whichplanbest2018.pdf

https://www.medmutual.com/For-Individuals-and-Families/Health-Insurance-Education/Compare-Health-Insurance-Plans/HMO-vs-PPO-Insurance.aspx

https://en.wikipedia.org/wiki/Deductible

 

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