In this section we offer information and tips on obtaining health insurance, your rights, laws, and accessibility to insurance. Select a topic on the Left for more detailed information on each subject.

Finding and buying Individual Health Insurance can be a very frustrating experience. There are several types of health insurance. These products range from Indemnity plans to HMO’s. The following grid illustrates the choices in the spectrum.

Adding to the problem is that priced for similar products from different insurers can vary as much as 50% for the same person. Doing your homework can save you a lot of money now, and more importantly, later, when you use your insurance. You can count on CASTLE GROUP HEALTH to do that work for you.

Most insurers sell their policies through independent agents. Some carriers, like Blue Cross, sell direct as well as through agents. Premiums are the same whether you use an agent or not. If you do deal directly with an insurance carrier, you may be frustrated with the service. It's generally advisable to obtain insurance from an independent agent who represents several different carriers, if you can find one. ( pardon our biased viewpont!)

Take heed, some of the big-name insurance companies, that most people associate with high quality products, don't have a good health insurance policy. Here are some features that you need to clearly understand in whatever policy you are examining.

A preexisting condition is defined as an illness or injury for which the person has been under the care of a physician and has received medical care or advice or a condition for which a reasonable person should have sought treatment.

Many individual carriers are now offering a waiver of the pre-existing condition clause for anything disclosed on an application and not specifically excluded. It is important to honestly disclose any preexisting conditions to your insurer. Failure to do so allows an insurance company the right to recind your policy at a later date.

New health insurance laws (HIPAA) have not eliminated the ability of individual carriers to deny policy issue or exclude medical conditions. The only new guanratee issue provisions are the State sponsored, insurance company funded, plans.

Group medical plans offer a waiver of the pre-existing condition clause if you have previous uninterupted coverage. Temporary insurance plans are eligible for “time-served” coverage with group plans.

More serious situations may be excluded or may cause a person to be declined. Controlled high blood pressure or cholesterol are routinely accepted by many carriers. Let your agent know your conditions up front. Good agents are in contact with underwriters and will only recommend policies that are most likely to accept you.

There are many conditions that make someone uninsurable. The hardest to understand why someone uninsurable is the time factor. Recent hospitalizations and diagnosed conditions usually make insurance carriers nervous. They then are inclinded to decline. Let us know about your medical issues up front and we can offer the most accurate help.

How Does an HMO Work?

HMO plans are very different from traditional health insurance plans. HMOs work on the premise that you can avoid future medical problems by "maintaining" your health now. HMOs usually offer you broader coverages and lower out-of-pocket expenses than traditional insurance, but you must use the HMO's health care providers.

• An HMO may operate only in certain counties and zip codes called a "service area." It is important that you live within your HMO's service area since you must travel there for all medical treatment. If you live elsewhere, but work within an HMO service area, you may still be able to join.

If you travel a lot, are outside the HMO service area for long periods of time, or have a child attending college outside the service area, an HMO may not be the best choice for you. Most HMOs provide limited coverage for emergency treatment you get outside the service area.

• In an HMO, you must get all medical care from their network of health care providers (doctors, hospitals and pharmacies). If you want to go to any doctor, hospital or pharmacy, at any time, an HMO is probably not for you.
• HMOs require you to choose a Primary Care Physician (PCP) to manage all your health care needs. You must always contact your PCP first. If your PCP decides you need services from a specialist, he or she will refer you to another provider in the HMO network. If the HMO network doesn't include a specialist qualified to treat your condition, your PCP will give you a referral to a provider outside the network.
• Female enrollees may also choose a Woman's Principal Health Care Provider (WPHCP) in addition to their PCP. The WPHCP is an obstetrician or gynecologist who is in the HMO's network. You can visit your WPHCP without a referral from your PCP.

What is an Evidence of Coverage?

HMOs issue an "evidence of coverage" that explains the services, benefits, exclusions and limitations of your coverage. HMOs must provide "basic health care services" such as hospitalization, preventive medicine, office visits, maternity care, diagnostic services and treatments for emergency medical situations, mental health care and substance abuse. It is very important to read and understand your evidence of coverage before you seek care. Here are some of the items included in an evidence of coverage:

• Emergency Room Care - Your evidence of coverage will explain guidelines you must follow in emergency situations, both inside and outside the HMO service area. If you don't follow those guidelines, you may have to pay the cost of emergency care.
• To qualify as a medical emergency, there must usually be a sudden onset of illness or injury which, if not treated immediately, would jeopardize your life or health. In emergency cases, use the nearest hospital emergency room.
• If you are inside your HMO's service area, go to the emergency room of an HMO provider if possible. You must get all other care from the HMO network providers.
• If you are outside your HMO's service area, go to the nearest hospital emergency room. Be sure to notify your PCP or HMO as soon as possible. Get an itemized billing and an emergency room report to send to your HMO.
• Urgent Care - Some HMOs cover urgent care services for members who travel outside the service area. If you travel a lot, choose an HMO that provides this coverage.
• Care Received Outside the HMO Service Area - If you are outside the HMO service area and need medical care that is not urgent in nature, you must call your PCP first.

What are Some Advantages to Joining an HMO?

• Less paperwork - There are no claim forms to complete.
• Fewer expenses - Your only expenses are your monthly premiums and copayments at the time of service. An HMO copayment is often a fixed dollar amount you pay each time you see a physician or buy a prescription. HMO copayments usually cost less than traditional health insurance deductibles and copayments.
• Broader coverages - HMOs cover a broad range of services including preventive health services, maternity and well-baby care. The HMO cannot exclude preexisting conditions. In addition, there are no lifetime maximum dollar limits on your coverage, although there may be other limits on your coverage. Many HMOs also cover services that aren't usually a part of traditional health insurance coverage, such as vision care, prescription drugs, and durable medical equipment.

What are Some Disadvantages to Joining an HMO?

• Limited choice - In an HMO you are not free to choose any doctor, hospital or pharmacy you want. You must use the HMO network providers. HMO contracts with providers end throughout the year. If your doctor leaves the HMO, you will have to choose a new doctor.
• Affiliation period - HMOs may impose an "affiliation period." During this time, you have no benefits, but you also don't have to pay premiums. The maximum affiliation period is two months (or three months for late enrollees).

What Should I Look for in Choosing an HMO?

Most people choose an HMO as an option from an employer group, plan or association to which they belong. However, a few HMOs in Illinois sell directly to individuals. When choosing an HMO, you should look at:

The HMO Itself

• Contact the Department of Insurance to find out if the HMO is licensed in Illinois.
• Contact the Department of Insurance or check the consumer complaint ratios on-line to check the HMO's consumer complaint record.
• Ask your friends or family if they belong to the HMO, and whether they are happy with the services and care provided to them.

The HMO Plan

• Is it affordable? How do the premiums and copayments compare to other HMOs offering similar benefits?
• Do the benefits match your needs? Are any services you need not covered?
• How does the plan treat preexisting medical conditions? (For example, even though an HMO can't exclude a preexisting condition, it can require a higher copayment.)

The HMO Health Providers

• Are the HMO providers familiar to you? Are they conveniently located? Is there a wide choice of physicians, specialists and hospitals?
• Are the HMO providers accepting new patients?
• Is your current doctor or specialist with the HMO? If so, is he or she satisfied with the HMO and planning to continue with the HMO?
• Is it easy to change Primary Care Physicians?

How Do I Add My Newborn Baby to My Coverage?

Your newborn is covered on your HMO plan from the moment of birth. Your HMO must cover all conditions, including illness, injury, congenital defects, birth abnormalities, and premature birth. Your HMO may require you to notify it of the birth and pay a premium to have coverage for your newborn. The HMO must provide coverage as long as you add the newborn within 31 days after the date of birth and pay the premium.

Can My HMO Require Me to Leave the Hospital
within 24 Hours of Delivering My Newborn?

No. Illinois law requires all HMOs to pay for:

• at least 48 hours of inpatient hospital care for mom and baby after normal delivery;
• at least 96 hours of inpatient hospital care for mom and baby after cesarean section delivery.

Your doctor is the only person who can decide to discharge you earlier. In that case, the HMO must then pay for:

• a home nurse visit for mom and baby within 48 hours after discharge; or
• a doctor's visit to check the baby within 48 hours after discharge.

What Happens if I am Sick or Hurt after My Doctor's Office has Closed?

Whenever possible, you must call your PCP before you get medical treatment. Your PCP is available 24 hours a day, seven days a week to help you. If you do not call your PCP first, you may be responsible for paying your medical expenses.

What if My HMO Coverage is Canceled?

If you lose your HMO coverage, you may be eligible to continue coverage under the federal COBRA continuation law, the state HMO continuation law, or a conversion policy. Read your evidence of coverage to learn how and when you may continue your coverage under these laws.

What if I Have a Problem with My HMO?

If you have questions about your HMO coverage, call the Customer Service number listed in your evidence of coverage. If you have a problem with a claim or treatment, your evidence of coverage explains how to appeal the decision to your HMO.

If your problem cannot be satisfactorily resolved by your HMO, contact the Department of Insurance Consumer Services Section.

Health Insurance Costs rising sharply....

Year 2000 marks the second year in a row of double digit average price increases for almost all carriers.   The efficiencies that were gained in the 90’s with the shift to managed care options such as PPO’s and HMO’s have gone as far as they can in reducing costs to the consumer.  The pendulum has begun to swing back towards much higher premiums. Unfortunately, we believe that this acceleration in cost increases will continue for an additional 12-24 months. 

There are many factors that lead to the this increase which include:

• Cost Shifting - Federal programs such as Medicare and Medicaid limit benefits in order to balance budgets.  These budgetary limits do not accurately reflect the the costs of treating public patients.  As a result, doctors and hospitals make up the difference in revenue by shifting charges to those who are capable of paying with private insurance.
• Mandated Benefits - Every time the government regulates certain benefits, such as mental health, maternity stays, fertility coverage, preventive care, chiropractic, the costs of those benefits are passed on to everyone regardless of who uses them.  These benefits are important, but are creating a perceived big-brother health care system with much higher utilization.
• Technology- New technology and drug treatments are increasingly expensive. Open heart surgery and organ transplants are almost routine. And where an average x-ray may cost $80, the same MRI costs $1200. The potential overuse of technology is being encouraged by multi hundred million dollar medical facilities that need to make a return on their investment.
• An aging America - There are more people over age 50 than school age, and a 55 year old has higher average medical bills than a 16 year old.
• Malpractice and Overtreatment- According to the American Medical News, a study by physicians of the AMA more than 8 of 10 physicians admit to practicing defensive medicine to avoid malpractice suits by ordering additional and sometimes unnecessary tests.
• Anti-HMO legislation - Their is a growing concern that doctors cannot act responsably if given financial incentives to be cost effective.  This, litigation driven, belief is putting nails in the coffins of HMO plans.

 The average insurance carrier prices a policy with the expectation of paying out between 75-80% in actual medical claim payments. The other 20-25% is used for administration, commissions and profit.

Health insurance utilization is generally trend driven.  Higher use leads directly to higher costs.  It is unusual for a large insurance company to singularly experience a bad quarter or period. A large carrier can disperse its risk over a broad population and if the numbers are not good, price increases will follow.  What happens to one insurer generally is happening, or will happen, to all carriers. In the second half of 1998, we believe that all carriers experienced a sharp and unexpected upturn in claims. 

Each carrier is reacting differently.  Some are rapidly increasing rates trying to become profitable quickly at the risk of losing their health members.  Other carriers are steadily increasing prices month to month in order to reach their profitability targets in a more orderly fashion.

Things you can do to control costs.

Be part of a PPO - About 5%-10% of health plan subscribers that have access to some sort of managed care are not in any type of managed care plan. We are not aware of any reason with any carrier where this is appropriate. It’s not good for the member or the insurance company.

 Make sure that you have the right plan design - Many people like a low deductible plan such as a $250 deductible.  Many times the $500 will be more than $250 less expensive. Families in more urban (expensive) areas should consider MSA plans. 

 Have a good and active agent -  By reading this, you obviously have some on-hands interest in your own healthcare. You are probably more informed and a better consumer than most, but....  A good insurance agent can provide you with information that you may not have been aware of or considered. The cost to you is nothing. Having a professional to discuss controlling your healthcare costs can save you a lot more than just premium.

Mark H. Gurda- update 9/18/2000