Understanding Health Insurance

The insurance world has its own special language which can be very confusing. The glossary at the end of the chapter explains insurance terms used in this chapter.

TIP: Don't be shy about asking your benefits planner or insurance agent for explanations in plain language if any part of your policy is unclear.

The first question is whether you have private health insurance. If the answer is no, skip the next few paragraphs and go directly to "Public Health Insurance". If you do have private health insurance, the next question is whether it is a traditional indemnity plan or a managed care plan.

Indemnity plans used to be the standard type of health insurance. Under an indemnity plan, the insurance company covers part of your medical costs, and you pay the rest as a co-payment. Many indemnity plans have an annual deductible or an amount the family must pay before the insurer pays. Traditional indemnity plans allow you to choose your health care provider. However, your out-of-pocket costs are likely to be higher than if you were a member of a managed care plan.

Managed care plans control costs by contracting with providers to deliver health care for a pre-determined fee. Your out-of-pocket costs may be lower with a managed care plan, but your choice of providers is restricted. Managed care plans may limit referrals or coverage for specialized services, therapies, or equipment.

There are three types of managed care plans. The first is called a Health Maintenance Organization (HMO), which organizes health care providers into a network. Each family member must choose a primary care provider (PCP) who is a member of the HMO. You must contact your PCP prior to receiving any medical treatment. If you seek services outside the HMO's network, the HMO does not cover the out-of-network costs. The next type of managed care plan is called Point of Service (POS). The POS plan is similar to the HMO in that you must see your PCP prior to seeking services. However, you can see a physician who is not a member of the network if you are willing to pay a higher out-of-pocket fee and a percentage of the doctor's bill. The third type of managed care plan is called a Preferred Provider Organization (PPO). Although it is similar to the POS, the PPO has a little more flexibility. Like the POS, you can see out-of-network physicians for a higher fee. However, you are not required to see your designated PCP for referral to specialists who are members of the network.

Your current insurance plan may have fit your family's medical needs in the past, but it may not provide the coverage your child needs now. Talk with your employer, benefits planner, or insurance agent to learn if your coverage needs to be adjusted. Under certain circumstances, your child may qualify for Medicaid even if you have private health insurance. Medicaid is discussed later in this chapter.

Individual Insurance Policy or Group Plan

If you are employed and have medical insurance through your employer, you probably are part of a group plan. Group plans offer coverage for the least cost by spreading risk across a large group. If you are not part of a group plan, consider joining one. Trade groups, fraternal organizations, chambers of commerce, or professional organizations often have group plans for members, self-employed people, or small businesses. There are open enrollment periods when you can change plans without being penalized. If you decide to change policies, make sure you understand exactly when coverage from one plan ends and the other begins. Also, find out if there are any waiting periods.

If you are unable to buy insurance through a group, you may consider buying an individual plan or supplemental insurance through an insurance agent. Individual policies are usually expensive and have limited benefits. Your child's medical history and any pre-existing medical conditions may affect eligibility or cost.

A pre-existing condition is a medical condition which has been diagnosed and treated before enrollment in the plan. Your child's injury may be considered a pre-existing condition if you decide to change insurance companies. For example, if your child was covered by Fidelity Insurance Company before his injury, Fidelity Insurance Company would not consider the injury a pre-existing condition. However, if you switch to Resolute Insurance Company after your child's injury, Resolute will consider your child's injury a pre-existing condition. It may impose a waiting period before coverage for the injury begins, or it may charge higher premiums. Each state has laws about how insurers can handle pre-existing conditions. Check with a legal advocate or the New Hampshire Insurance Department for the laws in New Hampshire.

Whatever type of medical insurance you have, remember: YOU are the customer. You have paid for a product and insurance personnel should answer your questions.

TIPS: Request a copy of your policy and read it carefully. You will need more information than the benefit summary brochures.

Questions to ask when applying for insurance or public health insurance programs:

  1. Do you have a brochure about the program and its coverage?
  2. How do I apply?
  3. What information do I need to collect?
  4. What services/equipment will be covered?
  5. Is there a co-payment?
  6. How long must I wait before coverage begins?
  7. Are there any circumstances that would affect our eligibility?
  8. Will my existing insurance be affected by this plan?

Public Health Insurance

Medicaid is a public health insurance program for people with low income and for disabled people with limited assets. It is funded by federal and state money. In many states, you may also qualify for Medicaid if you spend a certain percentage of your income on medical expenses. In addition to medical care, Medicaid may also pay for rehabilitation and equipment.

Some of the services that Medicaid may cover include:

Each state has detailed requirements about who is eligible, what Medicaid covers, and who can provide services. Your child's case manager or benefits planner can help you apply. Again, the Brain Injury Association of New Hampshire, the Parent Information Center, and Parent to Parent can help you as well. It takes time to get through the application and review process so start very early.

To qualify for Medicaid, certain financial criteria must be met. Some children, especially those with severe disabilities will be accepted regardless of their parents' income. Your child may qualify for Medicaid assistance even if you have private insurance.