I’m a big consumer of Texas’s own Blue Bell Ice Cream. I love all their flavors and the goodness they put into every pint or gallon of creamy delight. While I love their Homemade Vanilla, I would be very sad if that was all they ever had!
You don’t just have to have Vanilla!
When the Affordable Care Act (ACA, Obamacare) was put in place by our federal government, many people were concerned that it would be the only flavor of individual health insurance to be had for Texans needing individual health insurance coverage. Not so! In addition to employer-sponsored health benefits, private health insurance plans have been there all along for Texans as they navigate the health insurance options that fit their needs best.
Just the other day, I was able to move a client over to private coverage that had a lower health insurance premium than any alternative that she could find for her young son and herself. You see, she did not know these types of individual health plans existed. She thought the choices were limited to either her employer based health insurance or by the health insurance coverage dictated by the federal government. She had access to her employer-sponsored health insurance plan, but it far exceeded her budget. Learning about the offerings available through Private Health Insurance Companies was eye opening. Lowering the monthly premiums and keeping access to the desired medical services for her and her son was a game changer!
What Are Private Health Plans?
A Private Health Plan is a health insurance plan that is offered by an insurance company directly to you, the consumer. These private plans are usually different from government-run insurance programs like the ACA Exchange (Obamacare), Medicare, and Medicaid. Private health plans can be purchased individually and some can be purchased year-round, not subject to a certain and restrictive enrollment period.
Employer-sponsored health insurance plans are the most common type of private health plans available in the U.S. These plans are typically offered by employers to their employees as a benefit. Employees typically pay a portion of the premium costs for these plans, while the employer pays the rest. When adding spouses and dependents, these plans can get expensive if the employer does not contribute any additional premium dollars for them. What is a person to do if they enjoy the health benefits from their employer but can’t afford adding their significant others to their plan due to the increase in the monthly premium?
Individual private health plans are purchased by individuals or families who do not want or cannot afford employer-sponsored health insurance. These plans are available through health insurance companies, either on or off the health insurance marketplace or ACA. If they are on the health insurance marketplace, these plans become highly regulated through the government and the criteria is tight in regards to when and how a person can enroll. Government-subsidized health plans or Obamacare (ACA) can have lower monthly premiums as a result of the premium tax credits and sometimes even lower deductibles than other private insurance. This health insurance coverage also has minimum essential health benefits that must be provided, which provide a guaranteed level of care for everyone. If these private health plans are not on the exchange (marketplace), individuals typically pay the entire premium for these plans but have more flexibility in picking and choosing what to include in the plan.
I have sold many private health plans where the client gained additional coverage such as more hospitalization coverage to run alongside their current health plan for the price of a few hamburgers (or a gallon of Blue Bell) each month. In other words, you have flexibility you would not have if you are on employer-based health insurance or on a Government-subsidized health plan.
What Private Plans Look Like
Private health plans typically offer comprehensive coverage and offer a wide range of medical services including doctor visits, hospital stays, procedures, laboratory services, and prescription drugs. The caveat is that specific services that are covered by this health insurance coverage can vary from plan to plan. The good news is that they are scalable to meet your needs.
Private health plans also have different deductibles, copays, and coinsurance requirements. A deductible is the amount of money that you must pay out of pocket before your insurance starts to pay for your medical expenses. A copay is a fixed amount that you pay for each doctor visit or prescription drug. Coinsurance is a percentage of the cost of your medical expenses that you must pay after you have met your deductible.
One drawback to these plans is that they can also limit or exclude specific health care services from your plan type. This can affect expected covered services such as wellness services, preventive services, mental health services, newborn care, or coverage for pregnant women. Understanding which plans include, limit, or exclude specific medical care that you may need is a big part of deciding if a private health care plan is right for you. Sometimes, saving money on monthly premiums is not a great idea if your health care costs soar because your medical care ended up not being covered by your plan.
When Applying for a Private Health Plan
If you are considering applying for a Private Individual Health Insurance Plan, there are multiple factors for you to consider. First, the cost of private health plans varies depending on a number of factors. These include the plan's coverage details and conditions, your age and health, and also your location. If you are eligible for an employer plan, it is typically going to be less expensive than an individual private health plan if you are the only person in your household that is covered. However, you should be aware that when you begin to add a spouse or dependents that your out of pocket cost for employer-sponsored plans can skyrocket if your employer does not contribute to the monthly premium cost for those additions.
Next, a drawback to these plans is that many of the carriers that provide them will medically underwrite the plans. That’s a fancy way to say that if there is a major pre-existing health need or status, the insurance company may decline your application for coverage.
Additionally, there are other factors to consider when deciding between employment based health insurance, private health insurance policies, short term health insurance, high-deductible health plans, or catastrophic health insurance plans. These factors include level of coverage, supplemental coverage, coverage to children, and network of providers that can all be dialed up or down depending upon your choice of health coverage made inside this matrix. It really is more complicated than a monthly premium.
This is why you need an advocate on your behalf to help you navigate these issues. This advocate can help you find the appropriate level of coverage that has the best chance of being approved for your benefit. If you are considering purchasing a private health plan, or any type of plan really, it is important to compare plans and different companies to find the best plan for your needs and budget. We at Insurance for Texans are independent insurance agents who work as advocates for you and your desired health care coverage.
Ultimately, the decision of whether or not to purchase a private health plan is a personal one. It is important to weigh the pros and cons carefully to decide what is best for you and your family. But remember, you have a choice! You don’t have to choose plain vanilla! And we have strawberry, cookies and cream, and rocky road in our freezer for you as well!
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