How can I spot bad health insurance companies?
Listening to the arguments set forth by proponents of government run healthcare might lead you to believe that all health insurance companies are bad. But that’s not really the truth. Rather than trying to spot scam health insurance companies, consumers would be better off looking for bad policies.
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One of the truths about health insurance companies is the fact that there are many government regulations for health insurance companies, both at the federal and state level. American consumers don’t necessarily want to know this because it shatters their perception of evil corporations. Most of the confusion inherent in dealing with health insurance plans comes from these incredibly overburdening regulations. Health insurance companies can be sued for millions of dollars, so it’s no wonder they go to such great lengths to protect themselves financially.
Why are these health insurance policies are so confusing?
As previously stated, health insurance is tightly regulated at the state level. That means a company offering plans in 50 states will have to meet different requirements for each individual state. Some of those requirements can be pretty drastic.
The National Association of Health Underwriters explains this point and also throws in the fact that health insurance plans must be individually modified for the groups they are being offered to. All of these variables only serve to complicate matters.
A second point to consider was brought to light in a Fox News report published on January 11, 2012. In this report the author discusses all of the complicated legal language frequently found in health insurance policy documents. His point is that such complicated language is used as a means of protecting insurance companies against lawsuits. Without all the legal language an insurance company is open to all sorts of liability.
If it’s not the insurance companies, then how do I spot a bad policy?
Spotting health insurance fraud is a matter of knowing what to look for. Consumer Reports Magazine offers a great guide to help you choose a good plan. Part of the guide is a section offering seven signs that a particular plan might be bad. There is a plethora of other resources online with similar information as well.
One place you might want to start is your state’s own insurance department website. Often times they outline all the nuts and bolts of health insurance and how it applies in your state. Among the things to consider when trying to spot a bad healthcare plan are low priced plans which allegedly offer great benefits for low monthly premiums. The fact of the matter is that you never get something for nothing.
Today’s healthcare is expensive, there’s no denying that. Believing the hype of discounted health plans is simply foolish. The less you pay every month, the less coverage you are getting in return. You might also end up with extremely high deductibles and low coverage limits.
What if the only plan my company offers is a bad plan?
A continued weak economy and low growth prospects for the future are contributing to many companies limiting their health plans or dropping coverage altogether. This is no surprise if you consider the latest numbers released by the U.S. Bureau of Labor Statistics regarding how much it costs for an employer to hire and keep a worker.
The statistics indicate that just over 30% of the total cost of keeping a worker employed goes just to benefits alone. In terms of group health insurance calculations, nearly 9% of the total cost of a worker in the private sector goes to pay the employer’s portion of the premiums. If they must cut corners, health insurance plans are one of the easiest things to cut.
If your company offers only one plan, and it’s bad, you can always reject the coverage and purchase your own individual policy direct from an insurance company or another group you might belong to you. You can also elect to go without it if you so choose. When you’re tempted to blame insurance companies for the high cost of their products and the limited benefits they provide, remember that they must structure their policies and plans according to state regulations, while at the same time make a profit in a bad economy.
You can find out what companies in your area are offering in terms of health insurance benefits and rates by entering your ZIP code into the FREE search tool!