Limited Benefit Plans

[SusieQ2]

With all the unintended consequences from ObamaCare....

I've never been comfortable with the indemnity plans but I have some clients that don't qualify for any subsidy and they are paying more for their health insurance than they are paying for their house payment. Therefore, I've been evaluating various indemnity plans. Still don't really know if I'm comfortable with them but maybe something is better than nothing?? I'd like to get some thoughts on the pros and cons for clients.

The big con for me is that it's not health insurance and they're going to struggle when they go to the doctor or are checked into the hospital. If you don't have insurance a lot of doctors and hospitals require payment up-front unless it's a life threatening situation.

If you have someone to negotiate the bill for you and/or you are good at doing that as well, it seems to me they might work for some? Negotiating the bill may be the secret.

My personal experience with a concierge doctor before I went on Medicare -- he has agreements with an imaging place, CT scan of abdomen and pelvis was $250 cash.

Had one done after I went on Medicare and Healthcarebluebook.com lists that at $927, Medicare shows full price at $3,023 and approves $131.65.

As far as I can tell ObamaCare does not address that kind of thing. But wait............the government can fix it

Oh, whoops, I got political there for a moment

 

[LGilmore]

You know fixing on the price prior to adjustment is just a waste of time. Could be that is the max allowable from medicare that there reimbursement will cover (with the discount) above that, maybe the insured's cost as that may be the top of their U&C.

The ACA is simply a plan change that we get every year from carriers. That wasn't anything new. The only new about it for some states it took the cheap deal low coverage things away. My state WA, already had most of those requirements in place, so there was no real sticker shock. In fact, so far the last two years renewal rate average had been around 5%. I actually had rate reductions for medical plans. I can count on one hand how many years I had rate reductions for clients. Usually the renewals ran 8-15% a year.

You're not doing clients a favor with limited benefit plans. If they get sick the costs rise so fast, that it might be better to die.

I type this as I sit in a hospital bed with half of my right foot gone. I blistered my feet camping last July and have been dealing for months with the treatment. 3 days from a clean bill of health an infection came up, we treated it, everything looked good. I went home with a picc line and home infusion of antibiotics. Within 12 hours what was left of my infection (super infection) actually blew through the top of my foot to get away from the antibiotics.

Well I am well over 200k in medical costs for just this year. I have a personal case manager from the insurance company over this because of the cost. My cost for the year? $3500. Imagine how screwed I'd be if I capped at 50k, 100k?

Don't do that to your clients. A blister from flip flops turned into a bone infection and $$ of treatments, to finally an amputation. Something so simple ends up costing so much money before you know it, you have a case manager simply because I have unlimited coverage because of the ACA.

Imagine if their obligation ended at 100k?

Look at the ACA as a plan change. We've had them before with every carrier we sell insurance through. Look at it that way as it will change some more and eventually become a better working model.

 

[SusieQ2]

Thanks for the input.

Wow, what a story. So sorry to hear about your foot. Scary stuff out there.

 

[Yagents]

Limited indemnity plans are considered "supplements" to a major medical.

I believe it is or will be illegal to sell a supplement plan to anyone that does NOT currently have an ACA compliant policy.

This was in a recent reg release about 6 months ago. Maybe someone can provide a link, i'm too lazy. Allen??

 

[LGilmore]

Yagents? I don't know if there will be much of a market anymore because the individual max stop loss is $6350. I don't know if carriers will find it profitable to service such a small amount in payouts unless they price it to compensate.

The industry may decide not to play for now.

 

[FLM2]

With all the unintended consequences from ObamaCare....

I've never been comfortable with the indemnity plans but I have some clients that don't qualify for any subsidy and they are paying more for their health insurance than they are paying for their house payment. Therefore, I've been evaluating various indemnity plans. Still don't really know if I'm comfortable with them but maybe something is better than nothing?? I'd like to get some thoughts on the pros and cons for clients.

The big con for me is that it's not health insurance and they're going to struggle when they go to the doctor or are checked into the hospital. If you don't have insurance a lot of doctors and hospitals require payment up-front unless it's a life threatening situation.

If you have someone to negotiate the bill for you and/or you are good at doing that as well, it seems to me they might work for some? Negotiating the bill may be the secret.

My personal experience with a concierge doctor before I went on Medicare -- he has agreements with an imaging place, CT scan of abdomen and pelvis was $250 cash.

Had one done after I went on Medicare and Healthcarebluebook.com lists that at $927, Medicare shows full price at $3,023 and approves $131.65.

As far as I can tell ObamaCare does not address that kind of thing. But wait............the government can fix it

Oh, whoops, I got political there for a moment

It all comes down to what makes you comfortable-I would rather walk away from a client than offer an indemnity, limited benefit, or STM that could result in the client owing enormous sums of money in the event of a catastrophic illness.

I don't ever want to be the agent that has to take that call.

It's interesting, I got a phone call from a former sales director for a national carrier who wanted to find out if I would like an STM product with 23% commissions-when I said that I think every insurance company will find whatever excuse they can to not pay a claim under STM he completely agreed with me and he was an internal guy who has seen what goes on.

I just want no part of this aspect of the business, it's major medical or nothing for me...

 

[tonyisme]

Those $5 flip flops most expensive ever.
I stopped letting my kids wear them..i only wear in camping area showers or gym showers. And we can't run in them from an attacking animal or dog....
Sorry for your suffering
We see lot of foot, knee, leg , hip claims

 

[taterpeeler]

sorry for your loss............

 

[AllenChicago]

LGilmore, thank-you for candidly sharing your experience. Even though you've been through a lot, these medical events make us even better in the health insurance, disability, LTC, etc.. portion of our sales career...particularly if you have any of those products and were able to use them.

As you said, if you had Short-Term Medical, or a Limited Benefit plan, your family would be on the hook for lots of money already. The major medical will most likely cover your rehabilitation therapy sessions as well.

Thanks once again, LGilmore. Your message and advice will help more agents help more people than you realize!
-Allen

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Limited indemnity plans are considered "supplements" to a major medical.

I believe it is or will be illegal to sell a supplement plan to anyone that does NOT currently have an ACA compliant policy.

This was in a recent reg release about 6 months ago. Maybe someone can provide a link, i'm too lazy. Allen??

Yep, it became illegal on 1/1/2015 in Amerika. The signature page of Limited Benefit health applications now contain govt mandated wording (in 16pt font) generally stating: "I understand that this plan is not major medical health insurance, and that I must have major medical health insurance in effect in order to purchase this insurance."

Some companies, like Assurity, took this new rule to the extreme and put the wording on their Critical Illness application signature page as well.

 

[SusieQ2]

Thanks so much for all the comments. Y'all confirmed what I was thinking.

I was thinking much the same thing. So much is done outpatient now and that leaves a lot of gaps in the limited benefit plans.