Florida Health Insurance Guide

Basic medical insurance policies offer consumers differing benefits for room and board, physician, surgical and miscellaneous expenses. You should carefully check to see if policies offer equal benefits when comparing premium rates.

Major medical insurance
These policies provide protection against the high costs of hospitalization, injuries and serious or ongoing illnesses. Other possible coverages include the costs of blood transfusions, drugs and out-of-hospital costs, such as doctor visits. Most group health policies fall under the category of major medical policies. This category also includes the basic and standard plans issued under small group health access coverage (see “Group Plans”).

Major medical policies cost extra and provide more benefits than basic policies. A major medical policy normally pays 80 percent of covered expenses, after you pay the deductible. Insurance companies use fee schedules to determine the average cost of a procedure; however, this cost may differ from the actual charge you receive. Many PPO plans stipulate that the provider may not charge for the actual cost in excess of the usual and customary amount.

Maximum out-of-pocket limits restrict the amount of coinsurance you pay. Not all policies include such limits, but those that do pay 100 percent of remaining covered expenses after you pay a stated amount of coinsurance.




	Health Insurance Nobody plans on getting sick or injured. But life is full of unexpected events that force us to seek medical care. These include everything from a common cold to a more prolonged illness or injury. When these situations arise, your best financial defense is to have adequate health insurance. Health insurance can help protect your assets and pay medical expenses, but selecting the policy to best meet your needs can be challenging. This guide explains the various types of policies that are available, offers tips on choosing a policy and provides definitions for the numerous health insurance terms you may encounter. If you have any questions after reading this guide, please call the Florida Department of Financial Services Consumer Helpline toll-free at 1-800-342-2762. Traditional Versus Managed Care Coverage Your first health insurance choice may be to decide between traditional health insurance and a managed-care option. With traditional health insurance, you – the policyholder – select a health care provider, such as a doctor or hospital. You may have to pay for services when rendered and then submit the bill to the insurance company for reimbursement of the portion it agreed to pay under the policy terms. Frequently, the provider will submit the bill directly to the insurer and await payment. The managed-care system combines the delivery and financing of health care services. This limits your choice of doctors and hospitals. In return for this limited choice, however, you usually pay less for medical care (i.e., doctor visits, prescriptions, surgery and other covered benefits) than you would with traditional health insurance. The managed-care network controls health care services. Types of Managed Care Health Maintenance Organizations (HMOs) HMO members pay a monthly fixed dollar amount (similar to an insurance premium), which gives them access to a wide range of health care services. In many cases, members also pay a predetermined amount, or copayment, for each doctor or emergency room visit and for prescription drugs, rather than paying the provider in full and obtaining a portion of the reimbursement later. Recent legislative and regulatory changes have provided HMOs with the opportunity to offer plans with deductibles and coinsurance similar to PPOs (discussed below). HMO members often have little or no paperwork to complete due to the elimination of reimbursement. They must use the HMO’s network of providers, which may include the doctors, pharmacies and hospitals under contract with that particular HMO.You may obtain the free publication Health Maintenance Organizations: A Guide for Consumers by calling the Consumer Helpline toll-free at 1-800-342-2762, or by downloading it from the DFS Web site at www.myfloridacfo.com. Exclusive Provider Organizations (EPOs) In an EPO arrangement, an insurance company contracts with hospitals or specific providers. Insured members must use the contracted hospitals or providers to receive benefits by these plans. Preferred Provider Organizations (PPOs) A PPO offers another kind of provider network to meet the health care needs of consumers. A traditional insurance carrier provides the health benefits. An insurer contracts with a group of health care providers to control the cost of providing benefits to consumers. These providers charge lower-than-usual fees because they require prompt payment and serve a greater number of patients. Consumers usually choose who will provide their health services, but pay less in coinsurance with a preferred provider than with a non-preferred provider. Point-of-Service Plans These plans may be called by a variety of names and have various features. They combine some aspects of traditional medical expense insurance plans and other aspects of HMOs and PPOs. In a POS plan, insured members may choose, at the point of service, whether to receive care from a physician within the plan’s network or to go out of the network for services. The POS plan provides less coverage for health care expenses provided outside the network than for expenses incurred within the network. Also, the POS plan will usually require you to pay deductibles and coinsurance costs for medical care received out of network. Types of Traditional Care Basic medical insurance (hospital/medical/surgical) Hospital insurance usually pays a portion of your room and board. It may also pay some expenses for other hospital services, such as operating room use, laboratory tests and X-rays. Medical/surgical insurance helps pay for surgical and related costs (either in the hospital or doctor’s office), and may pay for anesthesiology. It may also pay doctor fees for medical visits when you receive hospital care other than surgery.Payments for surgical expenses are usually fixed amounts based on a surgical fee schedule. Insurance companies use fee schedules to determine the average cost of a procedure according to usual, customary and reasonable charges. Usual refers to the fee a doctor most frequently charges for a procedure. Customary involves the range of usual fees charged by doctors of the same specialty in a given geographic area for a specific procedure. Reasonable applies to a fee that differs from the “usual or customary” charges because of unusual circumstances. The procedure may involve medical complications that require additional time, skill and expertise. This provision limits the amount the insurance company will pay under your policy. If possible, check what your insurer will pay prior to the delivery of medical services subject to a usual, customary or reasonable rate. Basic medical insurance policies offer consumers differing benefits for room and board, physician, surgical and miscellaneous expenses. You should carefully check to see if policies offer equal benefits when comparing premium rates. Major medical insurance These policies provide protection against the high costs of hospitalization, injuries and serious or ongoing illnesses. Other possible coverages include the costs of blood transfusions, drugs and out-of-hospital costs, such as doctor visits. Most group health policies fall under the category of major medical policies. This category also includes the basic and standard plans issued under small group health access coverage (see “Group Plans”). Major medical policies cost extra and provide more benefits than basic policies. A major medical policy normally pays 80 percent of covered expenses, after you pay the deductible. Insurance companies use fee schedules to determine the average cost of a procedure; however, this cost may differ from the actual charge you receive. Many PPO plans stipulate that the provider may not charge for the actual cost in excess of the usual and customary amount. Maximum out-of-pocket limits restrict the amount of coinsurance you pay. Not all policies include such limits, but those that do pay 100 percent of remaining covered expenses after you pay a stated amount of coinsurance.