California Legislation that protects employees of companies with less than 20 employees. Picks up where the Federal Cobra laws leave off. Carriers are responsible for notification and administration. Premiums can be 10% higher than premiums paid by employer. It is important to acknowledge that the Cal-Cobra entitlements are connected to the master plan of the company’s insurance. Therefore if the company no longer offers health insurance, there will be no Cal-Cobra health plan available to the former employee. This is true for Cobra participants as well.
The flat amount or percentage you pay for a covered service after you satisfy the annual deductible, if any. Please note many plans offer co-pays that are separate of the deductible. In other words, it may cost you $30 to visit the physician and an additional 30% of a service such as a blood test. Co-Pay plans were introduced to California plan designs about 15 years ago in response to consumer responses. Office visit co-pays are clearly spelled out in a plan design. Some insurance companies have re-designed their plans to include a percentage co-pay rather than a fixed amount.
Consolidated Omnibus Budget Reconciliation Act. Federal Legislation passed in the early 80’s. This ruling provided extension of company coverage to employees who left their employment. The premiums for coverage can not be any higher than 2% of what the employer paid on employee’s health insurance. The employees have the opportunity to pay for their own group coverage for 18 months. Administration and notification are responsibilities of the employer.
Charges for services which are medically necessary and eligible for payment under the plan. A covered expense can be no more than the maximum amount stated in the plan. Some tests or procedures require prior authorization from the insurance company. A good example of a test needing prior authorization is a MRI.
The dollar amount an insured individual must pay for covered expenses during a calendar year before the plan begins paying co-insurance benefits.
Prescription drugs which the medical literature indicates are clinically effective, safe and of reasonable cost. The goal of a formulary list of prescription drugs, as established for a plan, is to identify and promote prescription drugs which are therapeutically appropriate and cost-effective.
A generic drug is produced and sold under the chemical name. Generic drugs are considered therapeutically equivalent to the brand name drugs by the Food and Drug Administration. Generic drugs, when available, are usually your best value. Typically lower co-payments are needed for generic drugs compared to brand name drugs. A generic drug can be manufactured after the patent has expired on a brand name pharmacy.
Prescription Drugs that are not on a particular plan’s formulary list. Plans vary on coverage of these drugs. Your Physician is provided a book of accepted medications by each carrier.
Explanation of Benefits (E.O.B): The statement sent to a patient (by the insurance company) following a procedure. This statement typically breaks down the cost of the procedure, the co-pay amount from the patient, the insurance paid amount and “negotiated rate” discounts.
Services provided that are medically required on an immediate basis for an illness or injury, in order to prevent loss of life, permanent impairment of bodily functions or other severe medical consequences.
Health Maintenance Organization: An organization that provides a wide range of comprehensive health care services through a designated group or network of doctors, hospitals, labs and other providers. To receive benefits, you must see the doctor you select as your primary care physician first, for care or a referral, except in the case of an emergency. Your choice of doctors is restricted to those in the network. The Primary Care Physician is paid a certain “fixed” fee for each member each month after enrollment. This fee is called a “capitation fee.” In California, women have the option of self-referral to their OB-GYN. Typically the OB-GYN needs to be within the network of physicians that her primary is in (i.e. Sharp Rees-Stealy).
This plan design is similar to the HMO plan. With this type of plan the member can self-refer to a physician who is not their primary physician. Typically the physician needs to be within the same network the member’s primary is in. The self-referred office visit is higher ($30). If the member needs lab work performed, they should have that done by their primary physician’s designated lab. Certain rules vary with this plan design. It is important to know how the plan works before using it, otherwise the member can have tests done and not have them covered. Aetna, HealthNet and Blue Shield HMO plans offer plans with this option.
An option for purchasing prescription drugs. Normally only maintenance drugs are available for mail-order purchases. A mail order purchase of prescription drugs can save money by eliminating one or two co-payments. Example: one co-payment for a 2 month supply. When taking advantage of this option, be sure to ask your doctor for the proper prescription amount. Certain conditions, such as diabetes require insulin and injection supplies that are covered differently than other medications. The mail order benefit is handled by the pharmacy plan of each medical plan. Typically the major pharmacies (Longs, RiteAid, Sav-On, Vons, etc.) do not process the mail-order forms. You will need to request a form from your insurance company upon enrollment.
Preferred Provider Organization: An arrangement under which a selected group of independent hospitals and medical practitioners in a certain area, agree to provide services at a prearranged cost (a set fee for each service). The doctor or professional medical service entity is paid for services as they are given to the patient/consumer. The patient can direct refer to specialists. It is important to note that many procedures and tests still need pre-authorization from the insurance company that is sharing expense with the patient. Even though a patient does not need to have a “primary physician”, a relationship with a general practitioner is still recommended. Many specialists see patients only after they have been to a general practitioner.
Pre existing conditions were concerns before “ObamaCare.” Previously insurance companies would refuse coverage or limit coverage when an employee had a medical condition. When a person applied for individual coverage, they would be declined. Now insurance companies enforce an open enrollment rule. There are rules for when you can enroll. Having open enrollment rules controls cost for the insurance companies. The pre-existing condition rule can still exist under certain circumstances. It is wise to ask when enrolling.
A California Insurance Licensed Agent for Health Insurance can either be licensed to sell health insurance by having a Life Producer License or Fire and Casualty License. Independence of submitting new business with Health Insurance Carriers depends on agent’s contracts with various carriers. Typically health insurance carriers are not as restrictive in accepting contracts with new agents as are the Property & Casualty Insurance carriers.
A medical expense insurance benefit structure that lists the amount payable for each expense of a medical procedure and or service.
May be called “Out of Pocket Maximum” or OOP. A maximum dollar limit set on the coinsurance, to limit the out of pocket expense that an insured can incur in a policy year. This may or may not include the deductible. Only covered expenses count toward the maximum. For example, any charges above the fee schedule for a doctor’s services do not count toward the “out of pocket maximum.”
Usual, Customary and Reasonable: A medical expense insurance benefit structure that is not scheduled, but rather is based on the fee charged by all doctors in a given geographical area.
Those services which are medically required within a short time frame, usually within 24 hours, in order to prevent a serious deterioration of a person’s health due to an illness or injury.