Over the past 50 years, most North Carolina residents have had their medical insurance benefits provided by their employer. In 2012, many companies are shying away from providing employees with company-sponsored health insurance plans.
You may ask yourself, “if my company will not provide insurance, where can I find a plan on the private market?”.
If you follow our easy to understand consumer guide, we will make comparing North Carolina health plans extremely easy.
If you have never shopped for your own individual health insurance plan in North Carolina before, you may find all the different options a little confusing at first.
The good news, is once you understand the basic different types of plans that each carrier offers and what to look for in a plan you’ll find that things will go much more smoothly for you.
Now we will break down the basic differences between the two most popular plan designs in NC.
Health Maintenance Organization
Preferred Provider Organization
Ok we have the basics out of the way, now let’s get into the meat and potatoes of what you should really be looking at in a Affordable Health Insurance plan in NC.
The most important thing in a plan is the network.
About 90% of all health insurance plans in North Carolina utilize PPO networks.
So you want to make sure
The second most important facet to consider is what your total out-of-pocket costs is to be if you have a bad year.
Don’t be too concerned with what you’re co-pays can be, consider yourself more with what’s the damage can be if you have a heart attack/stroke or need expensive medications that need to be filled every month.
Deductibles and Out of Pocket Maximums
Most Carolina residents reading this article, understand deductibles. It could be your car insurance deductible, your home insurance deductible-what ever kind of deductible it is you understand if the amount you come out-of-pocket before the insurance company pays anything.
With health insurance in North Carolina it’s very similar, but it’s very important also to understand the difference and how deductibles play into what you pay out-of-pocket.
Since most of the health insurance plans you’re going to compare utilize PPO networks, for the sake of this explanation we will just go ahead and assume your plan is a PPO plan.
The most popular plans will have a deductible, which will average $2500, $5000, $7500 or $10k. Before you meet that deductible, you will only be charged the contracted rate for in network providers, which will save you about 30 to 50% until you deductible is met versus using out-of-network providers.
So if you got an MRI bill, for $2000 and the in network contracted rate for that service was $1250, then you would only pay the 1250 and that amount would be credited towards your deductible for the year.
After your deductible has been met for the year, on most plans you have what is called coinsurance.
Usually plans have 80/20 or 70/30 coinsurance. So the insurance company may pay 80% of your bills, and you would pay the remaining 20%. Every reputable health insurance carrier in North Carolina does have a stoploss or out-of-pocket maximum. So they wouldn’t make you pay 20% of a $250,000 hospital bill.
Usually, you would pay 20% for the next 10 or $15,000. So if you added your deductible, let’s say it’s 2500 and your coinsurance stoploss which will say is another 2500, your total out-of-pocket for the year-worst-case scenario would be $4500.
That is the number you truly want to be concerned with.
Now we are going to do a breakdown of the differences in the three most popular plan designs in the Carolinas.
These are very similar to health insurance plans that are offered as part of employment by small and big companies in North Carolina.
But one of the most startling differences is that co-pays for doctor visits on private health plans, just cover the exam basically talking to the doctor. The copay of 20 or $30 does not cover any lab testing with most companies, this does not include wellness or preventative visits.
Also co-pay plans, don’t include the co-pays for office visits nor the deductible and co-pays for prescription medications into your maximum out-of-pocket for the year. This is something you should really look at, because if you have a drug deductible of $500 on your plan, plus if you take let’s say 4 medications a month at a co-pay of $25 each. You have just totaled up $1750 in expenses for the year that will not count towards your annual out-of-pocket maximum.
Hospital Surgical Plans
Some consumers referred to these as catastrophic plans, plans that cover the big stuff. While this might sound good in theory, these plans have some of the biggest holes in the North Carolina private health insurance market. If you go with a hospital surgical plan, you’re going to have a cheap premium but most of these plans won’t provide coverage for Dr. visits, outpatient medications, wellness or preventive care services. Think about that for a moment, it’s actually pretty big deal. What would you do if you had a hospital surgical plan, had a heart attack and had to go to see to specialists at $350 a pop and it’s not covered by your plan? or God for bid you have cancer, and you need outpatient chemotherapy medications that run you about $3000 a month, and those are covered?
High Deductible Health Plans
Don’t let the name “high deductible” scare you off, this is the name of these plans. A high deductible health plan could have a deductible as low as $1200.
With this kind of plan design, it’s pure insurance-there are no co-pays for anything. You simply pay your contracted rate, for covered services which save you about 30 to 50% until your deductible is met then you are covered at hundred percent for the rest of the year.
Most savvy consumers once they understand the different plan options, a good amount of them choose the high deductible health plan, because they want to enjoy a low premiums, and a set out-of-pocket maximum if they have a bad year.
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