It’s as thrilling as watching paint dry to learn about health insurance. It’s important to understand your rights and what your policy covers. Also, how to use the system. According to research, the American back pain spending has more than doubled in 10 years. A total of $18 billion was spent on doctors, physical therapists and chiropractors as well as medication, emergency room visits and other home-health-care treatments.
You want your policy to cover 80 percent of your hospital room and board costs after your deductible is met. However, it should also include no exclusions or an out-of pocket limit of $3,000-$5,000 per year.
There are many options and policies for back pain. Some insurance policies may cover complementary or alternative treatments like massage or chiropractic care, while others do not. However, you may be able to deduct the cost of over-the-counter medications and treatments depending on how your taxes are filed.
There are many tax-free options available today to pay medical expenses. Flexible spending arrangements (FSAs), HSAs (health savings accounts) and HRAs (health reimbursement arrangements) are the most popular. This appendix will discuss these accounts in greater detail.
According to the Internal Revenue Service (IRS), a medical expense is defined as the cost of diagnosing, treating, mitigating, treating, or preventing disease.
Treatments that affect any part or function the body. These costs include legal medical services provided by doctors, surgeons and dentists. These expenses include equipment, supplies, diagnostic devices, and other costs necessary for such purposes. This includes prescriptions and co-payments required for doctor visits.
You can also deduct certain expenses that are not covered by your insurance such as visits to the dentist or eye doctor. It all depends on how your taxes are filed. For more information, search “deductible medical expenses” at the IRS website. Talk to your tax preparer.
You should always consult your insurance provider before you go to expensive treatment or assume what is and isn’t deductible for health expenses. To avoid any hassles or headaches later, be sure to know what your options are before you make a decision.
Insurance is not an exception. All industries love their lingo. Notice that we used the word “business” here. Insurance companies are for profit businesses. They make the most money when they don’t have claims to pay. It is best to learn the basics of insurance.
There are many types of insurance policies. The cost of your insurance policy will be affected by where you live, how much you smoke, and what age you are. Employers often offer group health insurance. You may be eligible for group rates if you are self-employed.
The U.S. government has recently passed new laws regarding health insurance. This will keep health insurance in the news. It’s important to be familiar with the available information so you can make informed decisions and make better use of it.
If you are fired, the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA), will help you get by. Employers with 20 or more employees are required to continue offering health insurance coverage for 18 (or longer) months to workers who have quit their job. Although you will need to pay premiums, it will likely be less expensive than purchasing a policy on your behalf. Employer-based plans offer the benefit of group rates.
As the name suggests, this policy will pay benefits to you if your condition is too severe for you to work or if you become permanently disabled. There are many variables in the benefits, including policy requirements and payments. Pay attention to the fine print. Some define disability as inability to perform at any job. Others say that you can do your regular job.
You should also consider when and how long the policy lasts. Long-term coverage doesn’t usually take effect for more than 90 days. This is especially true if you are recovering from back surgery. However, short-term disability kicks in immediately and covers anywhere from 40-60 percent of your base income for a limited period.
Flexible spending arrangement. These are benefits that employers offer to their employees. The plan benefits are designed and managed by the employer. Employers and employees usually contribute to the account. An employee can then withdraw money from the account to pay for health-care expenses that are approved by their employer. FSAs can be used or lost. This means that money in an FSA account cannot be carried forward from one year to the next. It is either used or lost.
A health maintenance organization (or HMO) is a managed care program that allows you to receive medical care from participating providers. An HMO often requires that you see your primary doctor before seeing a specialist. If you have back pain, it is a good idea to see your primary care doctor (see Chapter 12).
An individual or employer can set up a health savings account. Many accounts come with debit cards that can be used for both over-the-counter and co-payments. You can save money on medical expenses tax-free. The account is not like FSAs in that any remaining balance at the end of the calendar year “rolls over to the next year”. You don’t need an HSA in order to deduct IRS-approved medical expense deductions. However, it can simplify accounting.
High-risk pools are a way to get insurance if you’re unable to obtain health insurance through other sources due to a serious illness. The new law on health-care provides money for states to either manage the program (according to federal regulations) or to allow the Federal Department of Health and Human Services to run it. Some states have an existing high-risk pool. There are many options for coverage and premiums.
This type of insurance is not like an HMO. You can access any hospital or doctor for medical care. The provider pays a portion of the bill to the insurance company. This plan often covers medical expenses in a way that is different from other plans. However, monthly premiums may be more expensive.
This policy covers all or part the cost of home care services, or care in a nursing facility or assisted living facility.
Medicare Supplemental Insurance (Medigap), and Medicare
Medicare is a federal program that offers health-care coverage for people 65 years and older, as well as certain disabled persons. Medigap insurance is private health insurance that covers the gaps in Medicare. It pays some of the costs associated with health care that the original Medicare plan does not cover. Only a “standardized” Medigap plan can be sold by insurance companies. Each policy must have specific benefits that you can compare.
This federal program offers health care for people with low incomes. It is a federal program but it is administered by the states. Features vary from one state to another.
PPO and PSO
A preferred provider organization (PPO), is a type managed care plan. A PPO offers more freedom than an HMO in selecting physicians and other providers. While you can see both participants and nonparticipating providers with a PPO, your out-of pocket expenses will be lower if only plan providers are involved.
A point-of-service plan (PSO), is also a type managed care plan. A PSO allows primary care physicians to coordinate patient care. However, there are more options for choosing doctors and hospitals in a PSO than an HMO.
There are many things you need to know about your individual policy. These are the most important things to know about all plans. These will allow you to make better use of your health-care benefits.
This is the flat fee that you pay for each visit to a doctor. The rest is covered by your insurance.
This is the annual amount that you will need to pay before your insurance policy kicks into effect.
Your monthly premiums will be lower the higher your deductible.
Limitations and exclusions
These are the things your insurance policy doesn’t cover. Although exclusions and limitations should be clearly stated in plan literature, there is often confusion about what is and is not covered. Talk to your agent before making any assumptions.
This is the monthly premium you pay. This could include your annual co-payments and deductible. The annual maximum you would have to pay is set by the plan. It is called the out-of-pocket maximum. According to a survey, back pain sufferers spent about 17 percent of their annual income on back care costs. Medicare paid 23 percent, private insurance paid 45 percent, and Medicare 23 percent. Other sources, such as workers’ compensation, were paid 15%.
This is the amount you must pay in order to be a member of a health plan. It is usually a monthly payment. Your share of premiums is usually deducted from your salary if you have employer-sponsored insurance.
Does your policy include emergency room visits? Are there any restrictions? Some health plans require that you notify your insurance company within 24 hours of visiting an emergency room. If not, the expense will not be covered. If the condition is not life-threatening, some plans require that you call your primary physician first. How does your plan define “life-threatening”? Although severe sciatica can be very debilitating, it is generally not life-threatening. However, if you suspect cauda, that could be a problem. Your options for hospital may vary depending on which plan you have. Before making assumptions, make sure you understand your policy.
In 2010, the health-care reform bill passed and outlawed denial of insurance due to preexisting conditions. Although the policy was effective for children in September 2010, it will not be mandatory for adults until 2014. High-risk pools (see section “High-Risk Pool” earlier) are available to assist those who have trouble obtaining insurance.
Workers’ compensation and back pain
This type of social insurance provides workers injured with income (or a portion thereof) and survivors benefits in the event of a fatality. However, workers who claim workers’ compensation benefits are not allowed to sue their employer.
Laws and Disputes
You have specific rights to your health benefits if you lose coverage or switch jobs. The U.S. Department of Labor has the following links that can assist you.
The Employee Retirement Income Security Law (ERISA).
This law provides protection to individuals who are enrolled in retirement, health and other benefit plans sponsored or sponsored by private-sector employers. It also gives participants rights to information, grievance and appeals processes to ensure they get the benefits of their plans.
The Health Insurance Portability and Accountability Act
This act, better known as HIPAA is a protection for millions of Americans and their families with preexisting conditions. It prohibits discrimination in healthcare coverage and guarantees the issuance of individual policies to certain individuals.
The following brochures may also be helpful. To view hard copies, call Employment Benefits and Security Administration (EBSA), or toll-free at 1-866-444-3272, or visit www.dolgov/ebsa.