Small Companies with BIG Health Insurance Problems

Here is one of my brain dumps - President Obama is on the Health Care Reform trail just as the Clinton's were in the early 1990s. Will he succeed? Is the recent COBRA subsidy a start at deteriorating the employer-sponsored health system for both small and big companies? As a veteran of health insurance, health insurance brokerage, and various distribution channels for the sale of group-sponsored health insurance, I have MANY opinions - some may be spot on, others could be far off.

Small employers are faced with continued increases in health insurance premiums. It is now time to get savvy, and to take a look at consumer-directed plans (HRA's and H.S.As) as they will undoubtedly play a role in the future as consumers will be faced with gaining more education with the end cost of health insurance. Drug companies faced with pressure to compete in the generic market, and the exhorbitant cost structure of name brand drugs, and the ugly rebate structure most "layman" know nothing about!! Why does my health plan have certain drugs in cateorgy 2 name brand versus category 3, the higher tier and price...?? REBATES! They are not doing it for their health, your health, but the drug company's profit health!

Let me switch gears to the horrible tail of individual health insurance....they skim, simply put. They underwrite and insure folks who are completely healthy, rate up the folks who have "common and simple" health issues, and decline anyone with "some" chronic health issues, such as diabetes, obesity (according to them), asthmatic, depressed, have thyroid issues...the list includes almost EVERYTHING. Where do these folks get coverage? They should visit www.healthinsurancegeeks.com and find out....they focus ALL of their effort on finding ways to help the small employer (sole proprietor, 2 member LLCs, small companies) find ways to get good coverage at the best price AND figure out if you really should be buying small group coverage (guaranteed issue) rather than constant declinations in the individual market. Let them help.

Back to consumer direct plans...some say it is just passing the first few thousand of costs to the consumer (for example, Aetna has a Managed Choice Open Access Point-of-Service plan with a $3,000 deductible but then pays 100%)...though that is true it is only part of the deal. When you buy a high deductible plan, though you are responsible for and basically self-insuring those first few thousand of charges, you still benefit from the negotiated rate physicians must accept from insurance carriers when they are in the network. So let's look at an example like the one above, but use Oxford Health Plans as another example:

You have a $3,000 deductible, but then the plan pays 100%. If you are like me and have a wife and 4 small kids, that means the family deductible is usually 2 times or $6,000. Okay so every person in my family, or 6 of us has a $3,000 deductible per year, but any 2 of us that hits that FILLS the family $6,000 bucket, so the other 4 people in the family would have 100% coverage and no deductible to meet. That is a big deal especially if you are saving 40% in premium for example, and can now pre-save the family $6,000 deductible in monthly installments, a la the H.S.A.

I spend lots of my time educating consumers, as that is the only way we will learn and save in the U.S. as the government and carriers will not solve all of our problems. We need to better understand our alternatives, be better consumers, and not sign premium checks assuming what we are buying is the best thing for us. You need to engage with a trusting advisor (like healthinsurancegeeks.com) who will hold your hand through the difficult process of analyzing all of the alternatives.