You probably pay a lot of money each month for health insurance, so it is important to know what you are TRULY getting from this huge personal expense. The New Jersey Doctor-Patient Alliance wants to help you, our members, make the most educated choices when it comes to purchasing health insurance plans.
In terms of health insurance, one size does not fit all. Please know that there are no health insurance plans available that will cover 100 percent of services for any doctor, let alone a quality doctor. Some plans may restrict your access and choice of physicians more than others. Likewise, some plans will shift significantly more out-of-pocket costs onto patients in the form of high deductibles and co-insurance.
Below is a brief overview of common plans offered in today’s health insurance marketplace.
PPO stands for "Preferred Provider Organization” plan. These plans provide much more flexibility and coverage when choosing a doctor or hospital. They also offer in-network AND out-of-network benefits. Please note that recently some PPO plans don’t offer out-of-network benefits. Please be diligent about verifying these details before choosing your plan.
PPO plans are generally more expensive than POS (Point-of-Service) plans because they have more extensive options for care. But you have to verify that you are getting what you pay. Health insurance carriers have drastically “gutted” out-of-network benefits, often unbeknownst to consumers and even seasoned insurance brokers. Insurance carriers do this by capping the amount they will pay for out-of-network services, regardless of the charged amount, at a low multiple of the federal Medicare reimbursement rate (e.g., 110% of Medicare). A Medicare rate usually only covers a small portion of an out-of-network medical bill.
Unfortunately, many PPOs have adopted this subtle but significant change to their out-of-network benefit plans amounting to a bait-and-switch for consumers. This could leave you (the consumer AND the patient) with a meaningless out-of-network benefit, and unknowingly responsible for the majority of a large medical bill.
EPO stands for "Exclusive Provider Organization" plan. These plans are true “narrow network” plans, which means the available doctor network is small, and your choices to a physician of your choice are limited.
As a member of an EPO, you can ONLY use the doctors and hospitals within the EPO network; you cannot go outside of this network for elective care, and there are no out-of-network benefits. It is considered to be more of a catastrophic plan that will restrict your options for elective healthcare.
HMO stands for “Health Maintenance Organization.” This type of health insurance plan usually limits coverage to care from doctors who work for or contract with the HMO.
HMOs generally do not cover out-of-network healthcare expenses except in an emergency. An HMO may require you to live or work in its service area to be eligible for coverage (i.e., you might not be able to go to NYC/PA/CT to receive non-emergent care from specialists such as an oncologist, heart surgeon, or spine surgeon).
Like the traditional HMO, OMNIA Health Plan members are restricted to using physicians and other health care professionals who participate in the Horizon Managed Care Network and hospitals in the Horizon Hospital Network. These plans do not include out-of-network benefits.
OMNIA Health Plans do not include out-of-network benefits. Additionally, OMNIA divides their doctors and hospitals into Tier 1 and Tier 2. Recently released insider documents have shown that quality alone only played a small part in dictating the tier status of a doctor or hospital, often overshadowed by considerations, not in the best interests of patient care. That said, if you see the best in-network Tier 2 doctor, your deductible could be as much as $5000, and you may have to pay up to 50% of the remainder of billed charges for that service.
We used Horizon insurance plans as examples of common plans since Horizon is one of the largest health insurers in the state of New Jersey. Please check with your plan regarding medical insurance coverage.
Things to consider about tiered-network plans:
Use the quick reference chart below, to compare plans.
|PPO||HMO||EPO||Omnia Bronze||Omnia Silver||Omnia Silver HSA||Omnia Gold|
|Access to a network of doctors, hospitals and other healthcare providers|
|Ability to see the doctor you want without a Primary Care Physician (PCP) to authorize treatment|
|Referral from a PCP not needed to see a specialist|
|Low or no deductible and generally lower premiums|
|Coverage for medical expenses outside the plan’s network|
An insurance premium is the amount of money that an individual or business must pay for an insurance policy. The insurance premium is considered income by the insurance company once it is earned, and also represents a liability in that the insurer must provide coverage for claims being made against the policy.
In addition to your premium costs, the term “cost-sharing” refers to the amount that your health plan expects you to pay out of your pocket for medical services. Most plans do this by setting rates for a deductible, and coinsurance for any given covered medical service.
In an insurance policy, the deductible is the number of expenses that must be paid out of pocket before an insurer will pay any cost. In general usage, the term deductible may be used to describe one of several types of clauses that are used by insurance companies as a threshold for policy payments.
Co-insurance is the amount, generally expressed as a fixed percentage, an insured must pay against a claim after the deductible is satisfied. In health insurance, a co-insurance provision is similar to a co-payment provision, except co-pays require the insured to pay a set dollar amount at the time of the service.
Now, check out the cost-sharing for PCP visits under the plan you are considering. Wellness or preventive visits typically have no cost-sharing. Next, look at the cost-sharing for non‐preventive services (i.e., certain bloodwork and labs, imaging, and other diagnostic (testing). Are copayments required for each visit? Do deductibles and/or coinsurances apply?
Does a given plan require co-payments for each visit to an in-network specialist? How much are the deductibles and/or coinsurances for each visit or procedure? For example, if you have a medical condition that may require you to see different specialists several times a year, take a look at how co-pays, deductibles, and co-insurances apply to those specialist services. For example, if a covered family member has the misfortune of breaking her wrist and getting a concussion after a fall, she may need to see more than one specialist multiple times, such as orthopedists, neurologists, physical therapists, chiropractors and/or acupuncturists.
This one is harder to estimate because many plans have different cost-sharing depending on whether the drug is considered to be "preferred" (formulary) or "non‐preferred" (non-formulary). You can call the company or visit the company's website to find out whether your drugs are in the lowest cost tier or not. Some plans include a limit on how much you have to pay for each prescription.
Make sure you ask your insurance salesperson or representative this question: "At what rate does the out-of-network doctor get reimbursed for this plan?” A good out-of-network policy will reimburse at something called "usual, customary, and reasonable” or UCR for short. A poor out-of-network policy will reimburse at a multiple of Medicare, such as 150% of Medicare. If an out-of-network benefit only reimburses a doctor at this low amount, you are potentially going to be liable for the rest of the bill, hence the term “surprise bill," mainly if it turns out OON benefit isn't much of a benefit after all.
Insurance companies DO NOT want you to use your Out-of-Network Benefits even though you are paying top dollar for them. They often do this by using a few different scare tactics.
Please note that in accordance with federal safe harbor laws, doctors are permitted, on a case-by-case basis, to discount enormous cost-sharing burdens, when you, as a patient, has a claim of financial hardship. Providers of the NJDPA will always work with our patients so that we can continue to provide high-quality care at fair health costs. We care about our patients, first and foremost.
Your medical care should be a decision between you and your physician.
The New Jersey Doctor-Patient Alliance strongly opposes efforts by insurance companies to act as your doctor by denying care, often against the judgement and expertise of your own doctor, the trained medical professional, and the only one who has actually seen you person, examined you, and made recommendations for what is in the best interest of your health.
We are here to empower you to ask questions so that you can have a full understanding of your benefits and make the best decisions in you and your loved ones’ health care.
If you have questions about your insurance policy or are having trouble with your insurance carrier, please fill out this form, and one of our representatives will answer your questions.