Nothing to worry about with health insurance.
As the name suggests, waiting period is quite literally the amount of time you need to wait. And in a health insurance, it refers to the amount of time you need to wait for, from the start of your policy, to be able to use the benefits of it.
For example: One of the most common types of waiting period is the time you need to wait to be able to use special benefits such as a Maternity Cover; in this case most health insurers will include a waiting period of 2-4 years i.e. before you can actually benefit from the maternity cover, you should have your policy for at least 2 years (the amount of time is dependent on the health insurance policy you buy).
1. Initial Waiting Period
2. Pre-Existing Diseases Waiting Period (PED)
3. Waiting Period for Specific Diseases
4. Maternity Benefit & Newborn Baby Cover Waiting Period
5. Waiting Period for Bariatric Surgery
6. Accidental Hospitalization Waiting Period
7. Complimentary Annual Health Checkup Waiting Period
8. Waiting period for Coronavirus
An initial waiting period, also known as the cooling period in health insurance, refers to the amount of time you’ll have to wait from the date of issue to actively start using your health insurance policy and benefiting from it.
As a standard in the industry, all health insurance policies today at least have a waiting period of up to one month.
The initial waiting period for health insurance is 30 days. However, this doesn’t apply to any health insurance claims related to an accidental hospitalization.
Typically, when you buy a health insurance policy, you will be asked about pre-existing diseases, and/or will also be asked to take a few medical tests that may conclude the same.
As per the IRDAI, a pre-existing disease refers to any condition, ailment, injury or disease that has been diagnosed up to 48 months before buying your health insurance policy.
Some examples of preexisting diseases include diabetes, hypertension, thyroid, etc. Thereby, if you do have a pre-existing disease, you will have to wait for the prescribed waiting period before you can claim for any hospitalization or treatment that is related to the disease.
On an average, the waiting period for the pre-existing disease is three to four years, depending on your health insurer and type of health insurance plan chosen.
The title is perhaps self-explanatory, i.e. waiting periods for specific diseases imply that you will need to wait for the prescribed amount of time when it comes to claiming for treatment and hospitalization related to a list of specific diseases.
On an average, the waiting period for this is two to four years.
As part of most health insurance policies for individuals and families, there is an option to also include a Maternity Benefit and Newborn Baby add-on for those planning a family soon and apart from just planning for the baby, it is wise to also plan financially for the expenses that arise during and post labor.
Typically, the waiting period with most health insurance policies ranges from one year to four years.
A bariatric surgery is included in some health insurance policies today. It refers to a surgery on the stomach and/or the intestines to help someone with extreme obesity related issues.
It is usually only recommended for those with a BMI above 40, and who are going through other health issues because of the same.
Accidents can cause the most unexpected injuries and other medical concerns. Therefore, given the nature of accidents; all health insurers do not account for any waiting period when it comes to accidental hospitalizations.
This means, one can claim for accidental hospitalizations even just days into their new health insurance policy. The initial waiting period doesn’t apply here either.
You may have noticed that some health insurance policies, also gives you complimentary annual health checkups as part of your health insurance plan.
However, there is a small waiting period required for this too and this may differ across different health insurers.
With the cases still rising in India, most people today are buying health insurance policies online to make sure they’re covered in case the disease does affect them or their family members.
A copay, short for copayment, is a fixed amount a healthcare beneficiary pays for covered medical services. The remaining balance is covered by the person’s insurance company.
Copays typically vary for different services within the same plans, particularly when they involve services that are considered essential or routine and others that are considered to be less routine or in the domain of a specialist.
Copays for standard doctor visits are typically lower than those for specialists. Note that copays for emergency room visits tend to be the highest.
A deductible is a fixed amount a patient must pay each year before their health insurance benefits begin to cover the costs.
After meeting a deductible, beneficiaries typically pay coinsurance—a certain percentage of costs—for any services that are covered by the plan. They continue to pay the coinsurance until they meet their out-of-pocket maximum for the year.
Once you hit your deductible, your health insurance plan may not pick up 100% of the remaining cost. Instead, you may be responsible for a percentage of the costs until your insurance does pick up 100%. The percentage of health care services you are responsible for paying is called coinsurance.
Imagine that your coinsurance is 15%. That means you are responsible for 15% of the cost after your deductible. Your insurance company covers the remaining 85%. For example: If you’ve hit your deductible and you have a $200 health care charge, you owe $30.
The set monthly premium that you pay to be covered by your plan does not go towards your maximum out of pocket costs. Even after you have met your out of pocket maximum, you will continue paying your monthly premium unless you cancel the plan, or change to a new plan during open enrollment period.
Medical services that you pay for, and which aren’t covered by your plan, will not count towards your out of pocket maximum.
The set monthly premium that you pay to be covered by your plan does not go towards your maximum out of pocket costs. Even after you have met your out of pocket maximum, you will continue paying your monthly premium unless you cancel the plan, or change to a new plan during open enrollment period.
Medical services that you pay for, and which aren’t covered by your plan, will not count towards your out of pocket maximum.
5 Tips to Save Money on Health Insurance
Your first tip for saving money on insurance is to actually know your options, and those will vary depending on whether your workplace offers health insurance benefits or if you’re exploring individual plans. Let’s start there.
If your workplace offers health insurance benefits, that’s the first place to look. In 2016, employer-based insurance covered 55.7% of the population in the United States, so by far, it’s the most common scenario. Your employer-paid group plan may have more limited options—usually a few different plan options within the same health care company. But your employer also shares the cost of premiums with you, which helps you save money.
Advantages of employer-paid group plans:
- Your employer shares in the cost of premiums with you.
- Your premium contributions can be made pretax (as well as contributions from your employer). That translates to tax savings for you come April.
- Your employer chooses the health insurance company and plan options.
If your workplace does not offer health insurance benefits or if you’re self-employed, partnering with a health insurance pro makes it easier to know your options. And just because you don’t have health insurance through an employer doesn’t mean you have a spend an arm and a leg on insurance costs. A pro can help you pick the right plan that works for your needs and your budget.
Advantages of individual plans:
- You get to choose the insurance company and plan that works best for you.
- You can change jobs without losing your insurance coverage.
- You can choose a plan that allows you to see the doctors you want.
#2: Know How Different Plans Work
There are three different ways to categorize health insurance plan options. You may have heard of them before, but knowing how the difference affects your health insurance cost can be complex.
Health Insurance Network Types
There are four different network types, also known as managed care plans. What does that mean? Simply put, it means that each of these types uses a specific network of providers. These providers agree to a lower cost of service in exchange for having access to the network plan members.
What are the four network types?
- Health maintenance organizations (HMOs) – An HMO provides access to certain physicians, clinics, and hospitals in its network. To be eligible for an HMO plan, you may have to live or work in in a particular service area. Your health care is only covered by insurance if you stay within your network of providers.
- Preferred provider organizations (PPOs) – If you use a PPO insurance plan, you pay less when you choose from a network of providers. You can get out-of-network care without a referral from your primary care physician, but it will be at a higher cost..
- Point-of-service (POS) – With a POS plan, you may be required to choose a specific primary care physician, who will have to refer you to specialists for care, if needed. You can receive care from physicians out of your network, but with increased out-of-pocket costs.
- Exclusive provider organizations (EPOs) – If you have an EPO plan, services are covered only when you use providers in your plan’s network, unless it’s an emergency..
Health Insurance Tiered Plans
Some plans are classified by tiers, which estimate the costs you pay out-of-pocket compared to what your insurance covers. Plans with lower out-of-pocket costs will generally have high monthly premiums. Plans with higher out-of-pocket costs usually have much lower monthly premiums.
How do you know which tier is best for you? There are a lot of factors involved, which is why it’s always a great idea to work with a health insurance pro who can help you choose the right option for your particular situation.
High Deductible Health Plan (HDHP)
The third classification for health care plans is the high deductible health plan (HDHP). A HDHP is simply a plan with a higher deductible, compared to traditional health insurance plans. According to the IRS, a health insurance plan with a deductible of at least $1,300 for an individual or $2,600 for a family qualifies as a HDHP.
High deductible plans offer lower monthly premiums, helping you save money over the long-haul. What’s the downside? With a HDHP, you will have a higher deductible and things like dental, vision, and prescription drugs may not be fully covered. The good news is there are still lots of ways to save money with a HDHP, including the option to take advantage of tax-free savings for health care expenses by utilizing a Health Savings Account (HSA).
An HSA allows you to contribute money to a savings account dedicated to health care costs tax-free. Using an HSA can be a great way to save money on health insurance costs, if it’s available to you.
Here are four reasons to consider an HSA:
- You can take advantage of tax-free contributions.
- Lower monthly premiums help you save money.
- Your contributions roll over year-to-year.
- You can invest your HSA funds so they grow over the long-term.
When you use pretax money to pay for co-pays and health care costs before you hit your deductible, you can reduce your overall health care costs. Even CSEZone takes advantage of the tax savings by using an HSA!
When you use an HSA, not only do you get the benefit of tax-free contributions and withdrawals for health care costs, you are also eligible for a tax deduction. In 2017, you can deduct your HSA contributions up to $3,400 for singles and $6,750 for married couples.
Having a higher deductible may seem scary, but when you already have the money on hand in your HSA to cover an emergency, it’s no problem. An HSA is an especially great plan if you are generally healthy. You’ll also be taking advantage of lower monthly premiums, and you’ll be able to use tax-free savings to cover any out-of-pocket health care costs.
In nearly all circumstances, you’ll save money by using physicians, clinics, and hospitals that are in your health care plan’s network. When you use in-network care, you can take advantage of the relationship that your plan has with certain care providers. These providers agree to lower fees on services in exchange for having access to the plan’s network members.
Depending on which health care plan you have, your costs for out-of-network care could vary.
- If you have a HMO or EPO plan, it’s likely you will be responsible for the entire cost of care from an out-of-network provider.
- Do you have a PPO or POS plan? Your insurance may still cover part of your care. But since your overall costs weren’t discounted, the amount you owe will be higher—even after your insurance chips in.
Let’s take a look at an example:
Stephen visited an in-network physician when he started experiencing flu-like symptoms. The charge was $200. Because his plan has a discounted rate with that doctor, he got a $50 discount on the service. His insurance covered $130, leaving him with a $20 bill to pay.
If Stephen had chosen an out-of-network provider for the same service, he wouldn’t have received a discount on the overall costs. Even if his insurance covered the same $130, he would be responsible for paying the remainder, which in this example would be $70. Stephen can visit an out-of-network provider if that’s his preference, but he should be prepared to pay extra.
If you can stay in-network for your health care, do it. It’s an easy way to save on your overall health care costs.
The responsibility of making sure your provider is in-network falls on you, so it’s important to ask the right questions on the front end. Just because a clinic accepts your insurance doesn’t mean that they are in-network. If you want to verify that a provider is in-network, call the customer service number for your insurance company.
What is “balance billing”?
When you work with an in-network provider, they have agreed to certain discounted rates on services. However, when you see an out-of-network provider, they can charge full price and bill you for anything that your insurance company doesn’t cover. The term balance billing refers to your provider’s ability to bill you for that remaining balance.
What should you do if you get billed for more than you think you owe?
Your first step is to double-check the math. Sometimes errors are made, either on your end or in your provider’s billing department. If you think there may have been an error, simply call your provider and explain that you think you may have been incorrectly billed.
It’s also a great idea to talk to an insurance pro, who can help you make sure that you understand your insurance bills correctly. Your insurance pro is your best advocate when it comes to navigating complex health care costs.
A health insurance broker can help you find the best plan for your budget and your family’s needs. Understanding your health insurance is complicated, so why not partner with an expert?
An insurance pro can:
- Help you review and compare your health care plan options
- Show you how co-pays and deductibles affect your overall health care costs
- Help you know if a tax-favored option like an HSA is right for you
- Navigate complex situations if you encounter unforeseen costs like balance billing
- Advocate for your best interests