Health insurance

Health Insurance for Individuals and Family

Individual and family health insurance plans can help cover expenses in the case of serious medical emergencies, and help you and your family stay on top of preventative health-care services. Having health insurance coverage can save you money on doctor’s visits, prescriptions drugs, preventative care and other health-care services. Typical health insurance plans for individuals include costs such as a monthly premium, annual deductible, copayments, and coinsurance.

2018 Obamacare enrollment

With all of the hype about the importance of ACA’s annual open enrollment, it’s easy to understand why many Americans believe their opportunity to enroll in ACA-compliant coverage has now passed. But for millions, that’s simply not the case.

Millions can buy outside of open enrollment

There’s actually a fairly long list of opportunities to enroll in ACA-compliant coverage outside of open enrollment. So before you give up hope on compliant coverage – and coverage that may very well include a subsidy – you should review our Insider’s Guide to Obamacare’s Special Enrollment.

Your reasons to enroll haven’t changed

If you’re wondering whether it still makes sense to enroll, consider this:

  • You’re still required by law to have ACA-compliant health coverage. If you don’t, you could face the individual mandate penalty. Yes, the GOP tax bill included repeal of the individual mandate penalty, but that doesn’t take effect until 2019. People who are uninsured in 2018 will still face a penalty. Calculate your penalty.
  • Coverage is still guaranteed-issue, regardless of pre-existing conditions.
  • Premiums for older enrollees are still capped at no more than three times the premiums for younger enrollees.
  • All new major medical plans are still required to cover essential health benefits.
  • And the financial assistance provided by the ACA is still available, with premium subsidies that are larger than ever in most areas of the country.

Subsidies can still greatly reduce your plan costs

Depending on your household income, you may still be eligible for premium tax credits (aka, premium subsidies) and possibly cost-sharing reductions (CSR, aka, cost-sharing subsidies).

  • Premiums subsidies are still available in the exchange for people with income up to 400 percent of the poverty level. (For 2018 coverage, a single person can earn up to $48,240 and be eligible for the premium tax credit, and a family of four can earn up to $98,400). Calculate your subsidy. In 2017, 84 percent of exchange enrollees received premium subsidies that covered an average of two-thirds of the total premiums.
  • The only thing that has changed about premium subsidies for 2018 is that they’re larger than they were in 2017 in most areas, since average premiums increased and the subsidies grow to keep up with premiums.
  • Cost-sharing subsidies are also still available in 2018, even though the Trump Administration has eliminated funding for cost-sharing reductions. People with income up to 250 percent of the federal poverty level still have access to Silver plans with reduced out-of-pocket costs.

A few reminders about affordable coverage

Given the premium increases that took effect in most areas for 2018, it’s essential for anyone who is eligible for premium tax credits – or who might be eligible with an income fluctuation later in the year – to enroll through the exchange if and when they have a special enrollment period. Don’t sign up for an off-exchange plan and miss out on the possibility of much more affordable premiums via a tax credit.

In general, the only people who should be enrolling off-exchange are those who are 100 percent certain that there is no way they will qualify for a premium tax credit during the year – keeping in mind that the premium tax credits are available well into the middle class and are larger in 2018 than they were in 2017 in order to offset the higher premiums. (A family of four earning $98,400 is eligible for premium subsidies in 2018.)

Remember that you have an option to either have the premium tax credit paid directly to your insurer each month to offset the amount you have to pay in premiums, or you can pay full price for your coverage each month and claim the full premium tax credit when you file your tax return.

But either way, it’s only available if you enroll in a plan through the exchange. If you buy your plan off-exchange, there’s no way to claim the tax credit at the end of the year, even if your income ultimately ends up at a level that would have been subsidy-eligible.

Short-term and other Obamacare alternatives

We’re big fans of the Affordable Care Act and what it’s done to improve access to affordable coverage. We know that the law has delivered health insurance for millions who were unable to find affordable coverage on the individual market in the past. And – if at all possible – we strongly encourage our readers to take advantage of the comprehensive ACA-compliant coverage the law has provided.

At the same time, we do recognize that there is a segment of the individual market population that is facing daunting rate increases. We realize that their coverage options may be limited – at least for 2018 coverage.

To those consumers facing high premiums – perhaps because they’re in the coverage gap or their incomes make them ineligible for subsidies – we still would emphasize that some health coverage is always better than no coverage. The good news: there’s a wide range of short-term health coverage available that could provide a temporary safety net until you can find less expensive comprehensive coverage.

A guide to individual and family health insurance

As much as we love the Affordable Care Act, we know as well as anyone that the individual health insurance market continues to be a source of confusion for many consumers.

Since 1994, this web site has been a guide for consumers seeking straightforward explanations about the workings of individual health insurance – also known as medical insurance. Within this site, you’ll find hundreds of articles loaded with straightforward explanations about health insurance – and the health law – all written by a team of respected health insurance experts.

Health insurance

Health insurance is a type of insurance that covers costs incurred for unexpected medical expenses. Health insurance is a relatively recent form of insurance; and it did not become important for most people until advances in modern medicine made many expensive procedures and drugs possible to cure injury and disease. Today medical expenses often exceed the cost of housing. A health insurer may be a corporation, a social institution, or a government agency. Health insurance can be market-based, socialized, or mixed, but in most countries is some form of mixture.

There are many types of health insurance plans. Some are high-deductible plans that insure one only against major expenses; these are the least expensive, but require that the insured pays a substantial amount toward medical expenses before the insurance begins to pay. Others are complete managed care programs that cover every visit to a physician and all medications. Health insurance plans can be for individuals, families, or groups. Socialized medicine is a form of national health insurance. Related types of health insurance usually purchased or provided separately are dental insurance, long-term care insurance, and disability insurance.

People want to live long, healthy lives, but the cost of insuring for the ever-increasing number and variety of medical treatments available is higher than what many people and societies can afford. This creates a moral and social challenge to reduce medical costs or find more ways for people to obtain health insurance. Solutions must be sought not only through innovations in combining personal responsibility with collective support (such as health savings accounts combined with high-deductible insurance), but also through increased attention to wellness and greater integration of alternative healing modalities with conventional medicine. At a deeper level, society will need to deal with questions about life, dying, and death and the ways in which advanced medical technologies can most appropriately intervene or not intervene in these natural processes.

History and evolution

Forms of life and disability insurance date back to ancient times. In ancient Greece, benevolent societies were formed to care for individual’s families when the income of the breadwinner was lost. Medieval guilds had similar plans. Many of the first group health insurance plans were an outgrowth of the guild idea. They were mutual insurance companies, like cooperatives, that were owned by the members. As shareholders, members would divide any profits from the company.

In the nineteenth century, early health insurance was actually disability insurance. Patients were expected to pay all other health care costs out of their own pockets. During the twentieth century, traditional disability insurance evolved into modern health insurance programs. Today, most comprehensive private health insurance programs cover the cost of routine, preventive, and emergency health care procedures, and also most prescription drugs.

Social Health Insurance

State-mandated health insurance began in Germany in 1883 by requiring that workers be covered by the sickness funds maintained by labor unions and various trades. These funds covered both medical care and loss of wages. Many other nations followed suit: Austria (1888), Hungary (1891), Norway (1909), Serbia (1910), Britain (1911), Russia (1912), and the Netherlands (1913).

Most other European countries subsidized mutual aid funds to make them more affordable by a larger number of people. However, in the first decade of the twentieth century, the population covered by these European plans was generally 25 percent or less. This is because health insurance was not primarily for medical care, but for income stabilization for families. Thus, many of the plans applied only to wage earners.

Germany

In Germany, coverage soon expanded to other parts of the work force, with family members of workers included after 1892. The state continually consolidated the various insurance funds. By 1928, practically all workers in Germany making less than 3,600 marks were forced to participate in the system.[2] As the program developed, longer coverage and more benefits were applied for. The benefits paid out by the funds continuously exceeded contributions and required government subsidy.

The socialized health insurance also saw an increase in what Walter Sulzbach has named «malingering» in his study The German Experience with Social Insurance (1947), that is, people not personally paying for the service use it more easily and longer.

Originally the insurance funds set the fees that would be paid for services. But in 1913, a German doctors’ strike was averted by adding members of the medical profession to the committee that determined the fee system. The frequent practice of physicians charging higher fees to wealthier patients was outlawed. Thus, the physician’s income became purely based on the number of procedures at the fixed fee per period, as opposed to the quality of the service provided. Patient choice of a physician became reduced as doctors were assigned by the system. By the late 1920s, up to 80 percent of the medical profession in Germany was working for the mandatory health-insurance system, and 60 percent of all earnings in the medical profession came from payments from the compulsory insurance funds. At the same time, patients grew increasingly dissatisfied with the factory-style treatment that developed. Pharmacies also became increasingly dependent upon the compulsory system, with as much as 85 percent of their business turnover coming from these insurance funds by 1932. Under the Nazi regime after 1933, the compulsory health insurance system became even more centralized and controlled.

Today, 92 percent of Germany’s residents receive health care through mandatory health insurance, provided by about 1,200 nonprofit sickness funds. Those not insured through these funds, mostly civil servants and the self-employed, have private for-profit insurance. An estimated 0.3 percent of the population has no health insurance. This population includes the very rich who do not need insurance and the very poor, who hope to receive health care through social assistance.

Russia

In communist Russia, Josef Stalin set up centralized state medical care. This system theoretically guaranteed medical care to every citizen. In reality, service was rationed, many remote areas were barely serviced, and the nomenklatura, or elite members of the Communist Party (CPSU), received priority in the best hospitals in Moscow and major cities. The communist system went bankrupt in 1989, unable to fund medical treatment. Subsequently, the system was partially privatized along the lines of the British system. But many Russian citizens are unable to pay for health insurance plans and fail to get adequate treatment in the antiquated facilities, many of which were built in Stalin’s time. The average lifespan of Russians has decreased by five years since the collapse of the communist system, and inadequate health care must be viewed as one of the likely causes of the decline. Many Russians with money who want treatment in modern facilities with the latest equipment travel to other countries.

England and Canada

The National Health Service (NHS) is the public face of the four publicly funded health care systems of the United Kingdom. These organizations provide the majority of health care in the UK according to the four categories of general practitioners, accident and emergency service, long-term health care, and dentistry. These four systems were founded in 1948, and have become an integral part of British society. Private health care has continued parallel to the NHS, paid for largely by private insurance, but it is used only by a small percentage of the population, and is used generally to cover treatment not provided by NHS services.

In England and Canada, and other governments that regulate national health care, budget constraints generally lead to rationing of medical services. People are treated more equally and everyone is covered. However, doctors are forced to see more patients and give them less time, and they are rated more on quantity rather than quality of care provided. There are longer waits for services, and few patients receive the more expensive treatments. For example, Canadian and British doctors see about 50 percent more patients than American doctors. In the United States, 87 per 100,000 people receive dialysis in a given year, whereas the number is 46 in Canada and 27 in England. Likewise, 203 people per 100,000 receive coronary bypass surgery in the United States compared to 65 in Canada and 41 in England. Britain, the country that invented the CAT scan, has exported many units to other countries, but has only half as many units per capita for its own citizens as the United States.

History of Private Health Insurance in the United States

The United States did not follow the course of European countries. For one thing, the federal government was very small compared to today, and health and labor issues were basically left to individual states and local governments. Instead, private insurance companies grew out of mutual assistance societies, which were not as widespread as in Europe. The first policy giving health benefits was offered by Massachusetts Health Insurance of Boston in 1847. A few other companies organized around 1850, but these early efforts quickly went bankrupt. The first individual plans in the United States began as a form of travel insurance to cover the cost if one was injured in an accident on a steamship or railroad.

Insurance companies issued the first individual disability and illness policies in the 1890s. This payment model continued until the twentieth century in some jurisdictions (like California), where all laws regulating health insurance actually referred to disability insurance.  Many of the early policies were expensive and only 30 to 35 percent of the premiums were returned to policyholders as benefits. The new industry was unregulated and fraud was widespread.

John Dryden, founder of Prudential Insurance, said in 1909 that such insurance should be left to fraternal organizations that could better monitor members and that commercial insurance could only be soluble if it was limited to death benefits. Many industrial life insurance policies were issued to working-class families in the first part of the twentieth century.

Labor Unions and Socialized Medicine

The American Association for Labor Legislation (AALL), organized in 1906, included notable progressive economists John R. Commonsand Richard T. Ely and had had success in promoting workers’ compensation and child labor laws. President Theodore Roosevelt was receptive to the AALL campaign for mandated federal health insurance, but was defeated in the 1912 election. AALL continued to hold conferences and meet with the American Medical Association (AMA) and gradually moved the public toward greater support for health insurance; however, business interests successfully lobbied to defeat any legislation that would make health insurance compulsory. Franklin D. Roosevelt’s Committee on Economic Security, which shaped the Social Security bill in the 1930s, favored including compulsory health insurance, but it was omitted from the Social Security Act for fear it would lead to the larger bill’s defeat. As progressive labor unions continued to push for national health insurance, World War II intervened.

President Roosevelt had planned to take up the issue of national health care again after the war, and President Harry S. Trumanunsuccessfully tried to get national health legislation passed. However, Truman developed some piecemeal ways that government could get involved in improving national health care. One method was to fund medical research and institutes to develop new advances in medicine. Another method was to create more welfare programs that could provide health care to the uninsured.

Hospital Insurance

In the 1920s, the development of modern hospitals became a new factor in health costs. Hospitals had traditionally been religious and charitable institutions primarily for care of people without families to care for them. However, with advances in surgery and expensive medical equipment, more hospitals became facilities for general medical treatment. Traditional insurance plans did not cover hospitalization.

The insurance plan normally cited as being the first to have provided some form of hospitalization coverage was Baylor University hospital’s idea of providing school teachers up to 21 days of care for a $6 annual fee. Other hospitals in Dallas followed suit. This was the origin of an idea that developed into Blue Cross; hospital insurance backed, not by capitalization, but by a guarantee by hospitals to provide care. Within a year after the stock market crash of 1929, hospital receipts per person fell to 25 percent of what they had been in the robust economy. In 1932, the American Hospital Association acknowledged the crisis in hospital finance and recommended other hospitals adopt hospital underwriting. The Blue Cross logo became used as a symbol that a hospital plan met certain standards of care.

Industrial Plans

General Motors signed a major contract with Metropolitan Life Insurance to cover 180,000 workers with health insurance in 1928. Under this plan and similar ones, about 10 percent actually was paid out in medical expenses and the bulk for lost wages. The National Labor Relations Act (or Wagner Act), passed in 1935, had given workers more rights in forming labor unions and entering into collective bargaining agreements with employers. During World War II, wage freezes were imposed, causing employers to seek additional ways to attract workers during the war economy. One alternative that could indirectly increase wages was to offer fringe benefits like health insurance. Employers with large groups of employees could bargain with private insurance companies or doctor’s groups and clinics that sold prepaid group plans. This created a climate in which health care became a key issue in employment, and the results spilled over for non-union workers as well, expanding both the scope of coverage and the percentage of employer contributions. Many unions preferred the Blue Cross plans for hospitalization because full payment for services was guaranteed.

Medicare

As migration from rural to urban areas continued in the United States in the 1950s and 1960s, the majority of U.S. workers became covered under company health plans. Governments adopted similar or better plans for their workers. The major portion of the population not covered by health insurance was older people who were not employed, or retired. This set the stage for another push for national or compulsory health insurance for these groups. In 1960, Congress responded to this push with the introduction of federal support for medical welfare programs in the states. When the Democrats swept the election of 1964, Medicare became a top priority and was finally passed, not as outright welfare, but as a compulsory program in which workers contributed a portion of income towards old-age medical insurance while they were employed.

The U.S. Health Care Crises

The ad hoc measures that arose to address health insurance in the United States in the twentieth century contained within themselves the seeds of an unstable national medical system, which grew into a leviathan. The increase in the number and expense of medical treatments available, the rise of near monopolistic groups among doctors and hospitals, the monopoly that patents provided on drugs, the lack of market forces in the health field with third-party health insurance payers, and the insatiable demand for health care by consumers all led up to a collision course between what health insurers had to charge and what consumers were able to pay.

The final irony is that better medical care has greatly increased the lifespan of Americans, leading to an ever-increasing proportion of elderly citizens dependent upon Medicare to the number of workers paying into the government system.

These crises have led to many attempts to control costs or raise rates, with the end result being greater disillusionment with the health care system and a growing number of less-insured or uninsured citizens.

In the 1990s, increased outsourcing of work and corporate restructuring was often triggered by unsustainable health insurance costs of employees. By 2000, health insurance contributed more to the cost of producing a new Chevrolet than the physical components of the car. Fewer employer health insurance plans have contributed to the growing number of uninsured citizens.

Attempted Solutions to Health Insurance Problems

HMOs and Managed Care

One solution to the health insurance crises, aimed at controlling costs, is managed care. Managed care plans often increase preventive coverage to keep members healthy, and they tend to ration treatments or at least limit expensive procedures. They often have nurses and lower-paid employees doing preliminary screening and some other things doctors traditionally have done. Through the 1990s, managed care grew from about 25 percent of U.S. employees to the vast majority.

Health insurance is a type of insurance coverage that covers the cost of an insured individual’s medical and surgical expenses.

In health insurance terminology, a clinic, hospital, doctor, laboratory, healthcare practitioner, or pharmacy that treats an individual is known as the «provider.» The «insured» is the owner of the health insurance policy or the person with the health insurance coverage.

Depending on the type of health insurance coverage, either the insured pays costs out of pocket and is then reimbursed, or the insurer makes payments directly to the provider.

In countries without universal healthcare coverage, such as the United States, health insurance is commonly included in employer benefit packages. It is often seen as an employment perk.

In the U.S., the number of uninsured people has decreased from 44 million to less than 28 million, according to the Kaiser Family Foundation. The researchers put this down to recent changes in legislation.

A Commonwealth Fund 2011 report informed that one-fourth of all U.S. citizens of working age experienced a gap in health insurance coverage. Many people in the survey lost their health insurance when they either became unemployed or changed jobs.

The level of treatment in emergency departments varies significantly depending on what type of health insurance a person has.

Types

Insurance can seem puzzling, but choosing the right product can be vital for your family’s health in the United States.

There are two main types of health insurance:

  • Private health insurance: The Centers for Disease Control and Prevention (CDC) say that the U.S. healthcare system relies heavily on private health insurance. In the National Health Interview Survey, researchers found that 65 percent of people under the age of 65 years in the U.S. have a type of private health insurance coverage.
  • Public or government health insurance: In this type of insurance, the state subsidizes healthcare in exchange for a premium. Medicare, Medicaid, the Veteran’s Health Administration, and the Indian Health Service are examples of public health insurance in the U.S.

Other types

Insurers can also be categorized by the way they administer their plans and connect with healthcare providers.

Managed care plans

In this type of plan, the insurer will have contracts with a network of healthcare providers to give lower-cost medical care to their policyholders. There will be penalties and additional costs added to out-of-network hospitals and clinics, but some treatment will be provided.

The more expensive the policy, the more flexible it is likely to be with the network of hospitals.

Indemnity, or fee-for-service plans

A fee-for-service plan covers treatment equally among all healthcare providers, allowing the insured to choose their preferred place of treatment. The insurer will typically pay for at least 80 percent of costs on an indemnity plan, while the patient pays the remaining costs as a co-insurance.

Health maintenance organizations (HMOs)

These are organizations that provide medical care directly to the insured. A primary care physician will usually be linked to the policy, and they will coordinate all necessary care.

HMOs will normally only fund treatment that is referred by this GP and will have negotiated fees for each medical service to minimize costs. This is usually the cheapest type of plan.

Preferred provider organizations (PPOs)

A PPO is similar to an indemnity plan, in that they allow the insured to visit any doctor they prefer.

The PPO also has a network of approved providers with which they have negotiated costs.

The insurer will pay less for treatment with out-of-network providers. However, people on a PPO plan can self-refer to specialists without having to visit a primary care physician.

Point-of-service (POS) plans

A POS plan functions as a mix of an HMO and PPO. The insured can choose between coordinating all treatment through a primary care physician, receiving treatment within the insurer’s provider network, or using non-network providers. The type of plan will dictate the progress of treatment.

Why is the type of insurance plan important?

The type of plan dictates how an individual will approach getting the treatment they need and how much money they will need to pay on the day.

In 2003, the U.S. Congress introduced a new option, the Health Savings Account (HSA). It is a combination of an HMO, PPO, indemnity plan, and savings account with tax benefits. However, it must be paired with an existing health plan that has a deductible of over $1,100 for individuals and $2,200 for families.

HSAs can top up coverage, extending existing plans to cover a wider range of treatments. If an HSA is paid for by an employer on behalf of their employees, the payments are tax-free. An individual can build up funds in the HSA while they are healthy and save for instances of poor health later in life.

However, people with chronic conditions, such as diabetes, might not be able to save a large amount in their HSA as they regularly have to pay high medical costs for management of their health concern.

These plans often carry a very high deductible, meaning that although premiums can be lower, people often end up paying the full expenses of any required medical treatment.

There is more overlap as plan types evolve. The distinctions between types of policy are becoming more and more blurred.

The majority of indemnity plans use managed care techniques to control costs and ensure that there are enough resources to pay for appropriate care. Similarly, many managed care plans have adopted some characteristics of fee-for-service plans.

The term health insurance is generally used to describe a form of insurance that pays for medical expenses. It is sometimes used more broadly to include insurance covering disability or long-term nursing or custodial careneeds. It may be provided through a government-sponsored social insurance program, or from private insurance companies. It may be purchased on a group basis (e.g., by a firm to cover its employees) or purchased by individual consumers. In each case, the covered groups or individuals pay premiums or taxes to help protect themselves from high or unexpected healthcare expenses. Similar benefits paying for medical expenses may also be provided through social welfare programs funded by the government.

By estimating the overall risk of healthcare expenses, a routine finance structure (such as a monthly premium or annual tax) can be developed, ensuring that money is available to pay for the healthcare benefits specified in the insurance agreement. The benefit is administered by a central organization, most often either a government agency or a private or not-for-profit entity operating a health plan.

Learn About the Affordable Care Act

The Affordable Care Act (ACA) was designed to give individuals and families greater access to affordable health insurance options including medical, dental, vision, and other types of health insurance that they may not have been able to get on their own or through an employer. Under the ACA:

  • You may be able to purchase health care through a state or federal marketplace that offers a choice of plans.
  • Insurers can’t refuse coverage based on gender or a pre-existing condition.
  • Lifetime and annual limits on coverage are eliminated.
  • Young adults can stay on their family’s insurance plan until age 26.
  • Seniors who hit the Medicare Prescription Drug Plan coverage gap or «donut hole» can get a discount on medications.

Read the full text of the ACA and learn more about its provisions and relationship to patients, insurers, businesses, and families.

When to Enroll

Open enrollment is the part of each year that citizens can freely make changes to their health care coverage purchased through the ACA’s Health Insurance Marketplace.

The next open enrollment period is expected to begin on November 1, 2017, and end on January 31, 2018. During the open enrollment period, you will be able to:

  • Re-enroll in your current plan
  • Choose a plan for the first time
  • Choose a new plan to replace your current plan
  • Make changes to your existing insurance plan

You can enroll or change your plan year-round if you have certain life changes:

  • Getting married or divorced
  • Having a baby or adding a dependent to your family
  • Losing other coverage
  • Moving to a new state
  • Qualifying for Medicaid or CHIP

Check to see if your life event qualifies you to change your coverage under a Special Enrollment Period.

How to Enroll and Get Answers to Your Questions

You can learn more about and apply for ACA health care coverage in several ways.

  • Find a local center to apply or ask questions in person.
  • Download an application form to apply by mail

Find the answers to common ACA questions about submitting documents, getting and changing coverage, your total costs for health care, tax options, and more.

Using Your Coverage

If you have questions about specific parts of your insurance plan, you must contact your insurance company to get answers. Only your insurance company can answer specific questions about doctors, medications, treatments, medical equipment, and what is and is not covered under your plan.

  • Find contact information for your insurance company on your insurance card or bill.
  • If you can’t find out how to contact your insurance company, contact the Marketplace Call Center.
  • If you need help appealing a dispute with your insurance company, contact the Marketplace Call Center.

Small Businesses

Businesses with 50 employees or fewer can offer Small Business Health Options Program (SHOP)plans to employees, starting any month of the year. Learn about small business tax credits to help companies with the equivalent of fewer than 25 full-time employees provide insurance coverage to their workers.

Health Insurance Plans

Learn  About Health Coverage

Health insurance helps you pay for medical services and sometimes prescription drugs. Once you purchase insurance coverage, you and your health insurer each agree to pay a part of your medical expenses—usually a certain dollar amount or percentage of the expenses.

How to get Health Coverage

You can get health care coverage through:

  • A group coverage plan at your job or your spouse or partner’s job
  • Your parents’ insurance plan, if you are under 26 years old
  • A plan you purchase on your own directly from a health insurance company or through the Health Insurance Marketplace
  • Government programs such as Medicare, Medicaid, or Children’s Health Insurance Program (CHIP)
  • The Veterans Administration or TRICARE for military personnel
  • Your state, if it provides a health insurance plan
  • Continuing employer coverage from your former employer, on a temporary basis under the Consolidated Omnibus Budget Reconciliation Act (COBRA)

Types of Health Insurance Plans

When purchasing health insurance, your choices typically fall into one of three categories:

  • Traditional fee-for-service health insurance plans are usually the most expensive choice, but they offer you the most flexibility in choosing health care providers.
  • Health maintenance organizations (HMOs) offer lower co-payments and cover the costs of more preventive care, but your choice of health care providers is limited to those who are part of the plan.
  • Preferred provider organizations (PPOs) offer lower co-payments like HMOs but give you more flexibility in selecting a provider.

Choosing a Health Insurance Plan

Read the fine print when choosing among different health care plans. Also ask a lot of questions, such as:

  • Do I have the right to go to any doctor, hospital, clinic, or pharmacy I choose?
  • Are specialists, such as eye doctors and dentists, covered?
  • Does the plan cover special conditions or treatments such as pregnancy, psychiatric care, and physical therapy?
  • Does the plan cover home care or nursing home care?
  • Will the plan cover all medications my physician may prescribe?
  • What are the deductibles? Are there any co-payments? Deductibles are the amount you must pay before your insurance company will pay a claim. These differ from co-payments, which are the amount of money you pay when you receive medical services or a prescription.
  • What is the most I will have to pay out of my own pocket to cover expenses?
  • If there is a dispute about a bill or service, how is it handled?

What is ‘Health Insurance’

Health insurance is a type of insurance coverage that pays for medical and surgical expenses incurred by the insured. Health insurance can reimburse the insured for expenses incurred from illness or injury, or pay the care provider directly. It is often included in employer benefit packages as a means of enticing quality employees. The cost of health insurance premiums is deductible to the payer, and benefits received are tax-free.

BREAKING DOWN ‘Health Insurance’

Health insurance can be tricky to navigate. Managed care insurance plans require policyholders to receive care from a network of designated health care providers for the highest level of coverage. If patients seek care outside the network, they must pay a higher percentage of the cost. In some cases, the insurance company may even refuse payment outright for services obtained out of network. Many managed care plans require patients to choose a primary care physician who oversees the patient’s care and makes recommendations about treatment. Insurance companies may also deny coverage for services that were obtained without preauthorization. In addition, insurers may refuse payment for name brand drugs if a generic version or comparable medication is available at a lower cost.

Insurance plans with higher out-of-pocket costs generally have smaller monthly premiums than plans with low deductibles. When shopping for plans, individuals must weigh the benefits of lower monthly costs against the potential risk of large out-of-pocket expenses in the case of a major illness or accident. Health insurance has many cousins, such as disability insurance, critical (catastrophic) illness insurance and long-term care (LTC) insurance.

Affordable Care Act

In 2010, President Barack Obama signed the Patient Protection and Affordable Care Act into law. It prohibits insurance companies from denying coverage to patients with pre-existing conditions and allows children to remain on their parents’ insurance plan until they reach the age of 26. In participating states, the act also expanded Medicaid, a government program that provides medical care for individuals with very low incomes. In addition to these changes, the ACA established the federal Healthcare Marketplace. The marketplace helps individuals and businesses shop for quality insurance plans at affordable rates. Low-income individuals who sign up for insurance through the marketplace may qualify for subsidies to help bring down costs.

Americans are required to carry medical insurance that meets federally designated minimum standards or face a tax penalty. In certain cases, taxpayers may qualify for an exemption from the penalty if they were unable to obtain insurance due to financial hardship or other situations. Two public health insurance plans, Medicare and the Children’s Health Insurance Program, target older individuals and children, respectively. Medicare also serves people with certain disabilities. The program is available to anyone age 65 or older. The CHIP plan has income limits and covers babies and children up to the age of 18.

What is International health insurance?

International health insurance is primarily aimed at expats who are living outside of their home country for an extended period of time. At Allianz Care, our plans include cover for day-to-day medical expenses like visits to the doctor, as well as planned surgery, emergency treatment, maternity cover, outpatient care and dental plans, depending on the level of cover you choose.

Our plans also include cover for chronic and congenital conditions and a wide range of pre-existing conditions, often without any additional exclusions or additional cost. We offer cover that is designed to be flexible, and allows expats to create a plan that best suits their needs.

How is Travel insurance different?

Travel insurance is primarily aimed at those taking short trips abroad, including holidaymakers and business travellers. Travel insurance usually covers unexpected medical emergencies or accidents that crop up during short trips away from home, as well as other travel-related emergencies like missed flights or lost luggage.

Our sister company, Allianz Global Assistance, provides travel insurance to those taking shorter trips abroad. Unlike international health insurance, this option is not suitable for globally mobile expats who need comprehensive day-to-day medical cover abroad.

Health insurance

Insurance against loss by illness or bodily injury. Health insurance provides coverage for medicine, visits to the doctor or emergency room, hospital stays and other medical expenses. Policies differ in what they cover, the size of the deductible and/or co-payment, limits of coverage and the options for treatment available to the policyholder. Health insurance can be directly purchased by an individual, or it may be provided through an employer. Medicare and Medicaid are programs which provide health insurance to elderly, disabled, or un-insured individuals.

Russia Health Insurance

Russia Health Insurance is Russia’s largest health insurance information provider.

At Russia-Health-Insurance.com we have provided extensive details of health and medical insurance concerns in the Russian Federation. By presenting you with a substantial list of companies specializing in medical insurance in Russia and the former Soviet bloc, and giving you detailed insights towards the ins-and-outs of a Russian medical insurance plan, our aim is to ensure that you are as informed as possible about the medical protection options in the country.

An Introduction to Healthcare and Insurance in Russia

The Russian Federation inherited its medical and healthcare system from the Soviet Union. While the modern Russian Federation abides by the socialist principle of free healthcare for everyone, the standards of healthcare in Russia have significantly dropped over last two decades as the country adopted a free-market economy. Recent efforts by the government to improve the healthcare system by injecting more funds, as well as introducing a compulsory medical insurance plans, will take time to prove effective.

Important distinctions should be made here between the obligatory medical insurance and voluntary medical insurance schemes. The former is provided and required by the government. Please click on the links to learn more about the differences between the Obligatory and Voluntary medical insurance schemes in Russia.

According to new regulations, any person who is a citizen of the Russian Federation is entitled to receive free medical care at any hospital or polyclinic anywhere in the country. The same rule applies to foreign nationals who are permanent or temporary residents, if their employer or client has applied for the scheme on their behalf. While concept of free healthcare may sound promising on paper, it is far from being the case. The medical services provided under the national obligatory medical insurance scheme are severely limited.

However, it is important to note that the overall quality of medical facilities and services in Russia barely meet international standards. Due to a large deficit of medical supplies, extremely low wages of medical workers, and a crippled bureaucratic setup of healthcare system, receiving treatment in a Russian hospital or polyclinic might be more harmful than beneficial.

Due to poor economic conditions hidden charges for medical treatments are often a frequent occurrence in an otherwise “free” public medical system, and are typically regarded as the norm rather than an exception. In order to avoid unnecessary spending and to ensure best quality of medical services, arranging for a comprehensive private medical insurance plan (voluntary medical insurance) for the duration of your stay in the country is highly recommended.

About Russia Health Insurance

At Russia Health Insurance we provide our clients with the most up-to-date information on medical insurance plans in Russia. We have extensive knowledge of the Russian Health Insurance Market which is complimented by comprehensive consulting with a broad variety of health insurance providers in the region. The information displayed on this website will always be impartial, competent, up-to-date, and free of charge.

If you are planning on traveling or relocating to Russia, or if you are an expatriate already residing in the country, Russia Health Insurance consultants are committed to providing most reliable and up-to-date information about variety of health insurance plans available to individuals, groups, and families in your situation. As the largest provider of information and resources for navigating the complex healthcare system and local insurance options in Russia, Russia Health Insurance is able to offer you the impartial and to-the-point knowledge that you will require to make an informed decision about your Medical Insurance coverage in Russia.

Russia Health Insurance Plans

There are a number of options for private, voluntary Russian Health Insurance plans outside of the government provided national healthcare scheme. By providing you with in-depth information about all the possible options we aim to address a wide range of healthcare issues and medical insurance preferences.

We also provide extensive details on comprehensive international health insurance options which would cover medical treatment outside of the Russian Federation.

Russia Health Insurance Companies

At Russia Health Insurance we have developed extensive relationships with, and knowledge of the world’s most reputable insurance providers. We frequently evaluate the medical insurance providers in Russia to ensure that you are completely comfortable selecting only a superior health insurance company to work with, and that you have access to the most accurate and relevant information from which to make an informed decision about Russian Medical Insurance coverage.

Russia Health Insurance Resources

As Russia’s largest health insurance information provider we offer most up-to-date knowledge about medical and healthcare matters in the region.

Whether you are looking for a Maternity Hospital in Moscow, dental clinic in Saint Petersburg or a private clinic in any other Russian city to make use of your purchased medical insurance we can provide you with the details you need.

Important medical resources for Russia include:

  • Russia Hospitals
  • Russia Health Insurance System
  • Russia Private Clinics
  • Russia Healthcare Costs
  • Russia Healthcare Legislation

Russia Health Insurance Partners

Currently not in Russia? Or are you thinking of moving abroad in the near future? With an extensive network of partners around the globe we can assist you in finding the right insurance plan that would suit your needs best. By offering all relevant and required information for such queries you will be sure to make the right decision when acquiring an international or local-specific medical insurance plan.

How to Find Health Insurance

Health insurance is a necessity for the proper prevention, diagnosis, and treatment of illnesses. With the passage of the Affordable Care Act (ACA) in 2010, Americans have more health care options, though they may be confused about how to find and pay for appropriate coverage. Health insurance is available through an employer, on the private marketplace, and through the Affordable Care Act’s exchanges.

Understand the benefits of group coverage. Because group coverage is provided for many people through an organization, insurance companies are ultimately able to save money. Accordingly, you are more likely to receive comprehensive (or full) coverage than if you purchase as an individual on the open market. You are also likely to pay a lower premium than you would by purchasing individual insurance.

  • One negative about purchasing insurance through an employer is that the employer probably makes various decisions about the scope of coverage. For example, the employer may want to only allow you to access physicians within one provider network.

Contact Human Resources. Your HR rep will guide you through the paperwork of joining a company insurance plan. Your company will generally offer several different plans from at least one, perhaps several, insurance carriers. In filling out your application, you may need information pertaining to:

  • Your previous insurance plan
  • Any enrolling eligible dependents
  • Any serious illnesses

Compare plan options. Many companies offer health insurance plans for full-time employees. You can also use these plans to cover an entire family, though you’ll have to pay some monthly fees based on the plan that you choose and the number of people you are covering. Companies typically offer these types of plans.

  • Health Maintenance Organizations, or HMOs, are the least expensive option. In this type of health plan, you have a primary care physician who takes care of all health issues and refers you to a specialist when necessary.
  • Preferred Provider Organizations, or PPOs, are more expensive, but give you more freedom in your choice of doctor. You are able to see any doctor within the organization without a referral.
  • Point of Service, or POS, plans offer discounted rates for providers that are within a network, but you are free to pay higher rates to see a doctor outside of the network.

Fill out an application. You should complete the application and turn it in to HR in a timely fashion. Keep a copy for your records in case HR loses the application.

Receive your health insurance card. After you submit your application to Human Resources, you should be notified promptly of your acceptance. However, your employer may have certain enrollment periods which limit when you can pick up coverage.

  • Pay attention to when coverage begins. If accepted, look for your enrollment date, which is the date that you can start using your health care insurance to pay for medical expenses such as doctor visits. The enrollment date can sometimes be several weeks after you are approved.

Consider COBRA for temporary insurance. If you are laid off from your job, then you still have the option of carrying your insurance. The Consolidated Omnibus Budget Reconciliation Act, or COBRA, allows individuals to continue an insurance plan after losing health insurance. While you will receive the same coverage, you will be responsible for the full payment of the insurance premiums. If you are leaving a job, your company will give you information about COBRA.

  • Alternately, the ACA marketplace also offers insurance enrollment if you have left or been laid off from a job. Insurance through the marketplace is likely much cheaper than COBRA.

Health insurance

This article gives an introduction to health insurance in Germany. The information is targetted primarily for English-speaking expatriates living in the country. See also: Health insurance

Basic introduction

Health insurance has been obligatory for everyone in Germany, including the self-employed, since 2007. Medical treatment can be hugely expensive.

For those employed full-time by a company, the employer pays half of the insurance contributions, the other half comes out of the employee’s salary. The employee’s half usually totals around 10% of their gross salary. When starting work with a company usually the employee won’t have to worry too much about how the system works. The company will automatically sign them up with an insurance company and the contributions automatically deducted from the salary. Sometimes the employee may be asked if they have a preferred insurance company. It is recommended to simply go with one of the big names, like «TK» (has the most information in English, used to only accept engineers and technical personnel) or «AOK» (don’t speak English, default insurer if you don’t choose a different one) or the smaller «SBK» (evolved from the insurance for Siemens employees, small but caring). They are all pretty similar in their cover, but TK and SBK regularly win the title of «best» public health insurances in the user rankings.

For the self-employed, they pay the full contribution themselves.

There are two types of health insurance in Germany. These are the «public» and «private» systems. This system often causes considerable confusion. Full details are given below.

Public Health insurance

If you are employed in Germany and you are earning less than the threshold ( Versicherungspflichtgrenze) of EUR 52,200.- gross per year (EUR 4,350 gross per month), you are automatically and compulsorily insured in a public health insurance scheme. This is also true for students at a state or state-approved university in Germany and certainly for interns too. This also means that your employer does not have the option of accepting an expat insurance scheme (see below). You are only exempt from mandatory public health insurance as an employee working in Germany if you are seconded ( German: «entsendet») by a company which has its HQ in a member state of the EEA (= European Economic Area; including all of the EU plus Iceland, Liechtenstein and Norway) or in certain contracting states (among them being Canada and Quebec, PR China, Israel, Japan and the USA; for the complete list please check with DVKA.de). «Secondment» exists if the employee goes abroad for work purposes on instructions from his/her employer and the work is time-limited in advance, inter alia because of the particularity of employment or by contract. Unfortunately I found no definition of the maximum acceptable «time-limit». The compulsory membership in German public health insurance while working here is protected by European Regulation No. EEC 1408/71, among others. It is furthermore laid out in the German SGB (=Sozialgesetzbuch), 5th book, § 257

All in all, what this means is: if you are employed by a German company or any other foreign company in Germany and you earn less than EUR 4,350 gross salary per month, you are a mandatory member of the public German health insurance system. You pay half plus 0.9% and your employer pays roughly half of the insurance premium too. As of 2009, the premium has been standardised for all public health insurance companies at 15.5% of gross salary up to the threshold ( Beitragsbemessungsgrenze) of EUR 47,250 (i.e. EUR 3,937.50 a month). This means that as an employee with a gross salary of more than EUR 3,937.50 a month, you will pay public health insurance capped at EUR 322.88 (8.2% of EUR 3,937.50), and public nursing insurance capped at 50.20€ (1.275% of EUR 3,937.50) if are childless or 40.36€ (1.025% of EUR 3,937.50) if you have a child. Your employer’s contribution will be roughly that much again, adding up to 15.5% for public health insurance and 2.3% for public nursing insurance (2.05% if you have a child). Although they more or less offer the same services, it’s still worth comparing.

Public health insurance is great, however, if you earn only a small amount (because you get a lot of insurance for a low sum of money) or if you are married and have a spouse and children with you — because they are covered by the public health insurance too (this may change in the near future, though, according to the latest political plans). But beware: since a lot of services from the public health insurance system have been downgraded or cancelled in recent years, you might want to consider getting additional private insurance to cover some services like 1- or 2-bed rooms in hospital, Chefarzt-Betreuung (operation and treatment by the head doctor of the hospital) or full dental services/replacement etc. Even then you might still have to pay some extra if you have a very complicated illness and you try to get the most-respected expert in Germany to treat you, because in these cases treatment is only covered up to a certain limit. If you want to be sure about having enough funds in the event of severe illness to get the best possible treatment, other insurance types (Dread Disease offered by Canada Life or Scandia for instance) are a possibility.

Private Health Insurance

Now if you are earning more than the threshold of EUR 4,350 gross salary per month, you can elect to leave the public health insurance and get a private health insurance while employed in Germany. Your employer will contribute roughly half of its cost, his share will be up to EUR 287.43 for health insurance and up to EUR 40.26 for nursing insurance, since this is the most he would have had to contribute if you had remained in public health insurance.

Here the comparison between different offers is a bit more complicated and you may want to get the advice of a professional advisor or broker. I have seen some attempts to compare different quotations from different private health insurances, but you cannot just take one quote with the price XYZ and another one with ABC to be paid per month and say that the cheaper one is the better choice — it may vary strongly regarding the insured coverage. The best way to start a comparison is to ask private insurers to send you a quotation «Analog GKV», meaning with the same coverage as the public health insurance. Then you can compare the insurance quotations on an even footing.

You can also lower your premium by using «excess options (Selbstbeteiligung)». This means that you are willing to pay for instance the first 300.- EUR every year out of your own pocket and you will receive reimbursement only for the costs in excess of that 300.- EUR. Since most of the private insurances offer to repay you 1 or 2 monthly premiums after one year of not having using the insurance at all, you should add this repayment amount to the excess-option-amount agreed in your contract and then you know at what medical cost per year it makes economical sense to hand in all invoices to the insurer during any given year. The highest excess option I know of is 2.400.- EUR per year; standard is between 300 and 750 EUR per year.

If you take a very high excess option, you will achieve a similar coverage like with most expat health insurances: you are covered for all serious medical problems, but you will pay for all prescriptions and ordinary consultations of a doctor out of pocket.

So, a Private Health insurance can be much lower in monthly premium than a Public health insurance while providing you with more and better coverage.

Still: if you are married with children and your spouse does not earn any income here in Germany, public insurance covering all family members with your own premium can be the better deal. And if you want to have a better coverage than Public Insurance offers, you can always get an add-on insurance from private insurance companies, where you cover certain medical issues that you deem to be important for you.

And no, you cant use travel health insurance from your home country ( and yea travel insurance may be cheaper) For a visa you need german insurance.. .

Use of Foreign Health Insurance

One of the main questions I have seen on TT is the question Hutcho asked me too: can I use a private insurance from abroad, which is cheaper than German insurance even though it may not cover all that German private insurance offers? For instance Expathealthcare, Bupa etc. The answer I finally got from the official side is, amazingly, YES! Apparently you can… My source for this valuable information is someone at the DVKA, the «Deutsche Verbindungsstelle Krankenkasse — Ausland», a federal institution. But this of course applies only if you are above the magic threshold of monthly income stated above, i.e. would be eligible for Private Health insurance according to German laws and regulations. Hence theoretically you could ask your employer to accept a BUPA or MediCare policy — even as a German employee, if I understand this regulation correctly.

However: a) foreign insurance is most certainly not certified according to § 257, 2a and hence your employer has no obligation to pay a share of the insurance costs, as he is required to do if you select a licensed German private health insurance. He may nonetheless decide to do so. But some tax issues would inevitably arise for the employer if he does. b) According to German law/regulations you will also need an additional «long-term care insurance». For this you will need to pick a German insurance because to my knowledge no foreign insurance is qualified or certified for this insurance. This insurance is required by law; you cannot avoid it.

Now remains one important question: why are foreign health insurances so much less expensive than German health insurances? Of course there are differences in the coverage that cause a different computation of risk for the insurance company to be asked to pay out of the insurance coverage. But what makes a German insurance also so much more expensive is that they build up a capital stock for the insured early on in order to make sure that health costs do not explode in old age. This is something the expat insurances seem not to do if you look at the increase of premiums for people aged 30 to people aged 50. Therefore, if you plan to stay in Germany for a longer period of time, it might be wise to pay the higher premium on the German insurance in order to keep costs stable in later years.

Moreover, you should be aware that expat health insurance schemes have limitations on cover for chronic conditions. Such policies are designed to cover treatment of medical conditions that respond quickly to treatment (acute conditions). Medical insurance is not intended to cover you against the cost of recurrent, continuing or long-term treatment of chronic medical conditions since these treatments become a series of predictable, rather than unexpected, events. See the following link for further information and for examples: AXA PPP — chronic conditions

Health insurance for freelancers

Health insurance is usually arranged through a person’s employer, who also contributes to the scheme. The self-employed, on the other hand, are responsible for arranging their own private insurance. Since 2007, even the self-employed are legally obliged to have health insurance cover. They can choose between private health insurance schemes offered by German providers and the expat schemes outlined above. Advice from an independent agent is recommended. Health insurance costs are tax deductible (at least that part of it that corresponds to basic cover as offered by public health insurances); an insurance agent or financial advisor will be able to advise you on this.

Summary

It is now up to each individual to check the services offered by foreign insurance companies with regard to his/her needs and security requirements and then decide which is the overall best option. As it is, an employer can not force you to legally use a German private health insurance at all. But the computer system may not be able to handle having no employer-share of health insurance or other such administration problems… And you should make sure to pick an insurance company that has a good track record in actually paying you the money if you need to get expensive treatment or hospitalization. Otherwise even a fortnight in a German hospital with surgery can easily run up a bill of tens of thousands of euros. And finally you need to decide if you plan to stay in Germany only for a short period of time or for several years or maybe the rest of your life: in the later cases, the German insurance will give you a good deal on the long run.

Conclusion

Even though this will of course sound somewhat selfish considering my own profession, if you can opt out of the public insurance system the best advice is to take an independent broker to help you understand your options and to guide you through the legal jungle here in Germany.

Why do I need an International Healthcare Plan?

Are you an expatriate going on a new life experience, living and working away from your home country? If you are, international health insurance is specifically designed for you. It’s perfect for people who are going to live abroad for a year or more and gives you the same quality of medical care as you’re used to no matter what country you’re in.

We talk to a lot of expats who think that travel insurance will have the same medical cover. It won’t. While travel insurance does include some basic health coverage overseas, it is only designed for holidays when lost luggage and delayed flights take top priority. When it comes to protecting your health and avoiding the hassle of medical expenses, the best long-term solution is going for a private health insurance plan with worldwide medical coverage.

International Healthcare Insurance

As our name suggests, Expatriate Healthcare is dedicated to providing international medical insurance for those living and working abroad as expats, travellers or volunteers.

In fact, because that’s all we do, Expatriate Healthcare is best placed to provide you with the right global healthcare coverage at the right price to complement your lifestyle overseas.

Our focus is to deliver peace of mind and this is reflected in our 3 key insurance plans, which offer varied levels of international medical coverage to suit your personal circumstances and budget.

Key Benefits of our International Healthcare Policies

  • Instant Healthcare Cover
  • 24 Hour Support
  • No Hospital Restrictions
  • Comprehensive Protection
  • Chronic & Terminal Cover
  • No Out-of-pocket Hospital Expenses

Affordable health insurance for you and your family

Cover medical, dental and vision care for everyone in the household with Progressive® Health by eHealth—a trusted provider—and with more than 13,000 options from 180+ carriers, you get the coverage you need at a reasonable price.

eHealth helps you with all your medical insurance questions and concerns, such as:

  • What the Affordable Care Act means for you
  • How to apply for a government subsidy
  • How much health coverage you need
  • How to compare plan benefits and costs
  • When you should enroll and what plans you qualify for

eHealth provides health plan finders and comparison tools that are easy to use and understand. We may also recommend to you the plans that are best suited to your needs and budget, whether it’s during the annual open enrollment period or if you have a qualifying life event. In certain states, we can even help you apply for the Affordable Care Act tax credit offered by the government.

If you’d rather get personal service, we offer world-class support from more than 250 licensed insurance agents. Just phone, email, or chat live with us.

Health Insurance Information

What kinds of health insurance are there?
There are essentially two kinds of heath insurance: Fee-for-Service and Managed Care. Although these plans differ, they both cover an array of medical, surgical and hospital expenses. Most cover prescription drugs and some also offer dental coverage.

  1. Fee-for-Service
    These plans generally assume that the medical professional will be paid a fee for each service provided to the patient. Patients are seen by a doctor of their choice and the claim is filed by either the medical provider or the patient.
  2. Managed Care
    More than half of all Americans have some kind of managed-care plan1. Various plans work differently and can include: health maintenance organizations (HM0s), preferred provider organizations (PPOs) and point-of-service (POS) plans. These plans provide comprehensive health services to their members and offer financial incentives to patients who use the providers in the plan.

What is ‘long-term care’?
Because of old age, mental or physical illness, or injury, some people find themselves in need of help with eating, bathing, dressing, toileting or continence, and/or transferring (e.g., getting out of a chair or out of bed). These six actions are called Activities of Daily Living–sometimes referred to as ADLs. In general, if you can’t do two or more of these activities, or if you have a cognitive impairment, you are said to need “long-term care.”

Long-term care isn’t a very helpful name for this type of situation because, for one thing, it might not last for a long time. Some people who need ADL services might need them only for a few months or less.

Many people think that long-term care is provided exclusively in a nursing home. It can be, but it can also be provided in an adult day care center, an assisted living facility, or at home.

Assistance with ADLs, called “custodial care,” may be provided in the same place as (and therefore is sometimes confused with) “skilled care.” Skilled care means medical, nursing, or rehabilitative services, including help taking medicine, undergoing testing (e.g. blood pressure), or other similar services. This distinction is important because generally Medicare and most private health insurance pays only for skilled care–not custodial care.

What are the types of disability insurance?
There are two types of disability policies: Short-Term Disability (STD) and Long-Term Disability (LTD):

  1. Short-Term Disability policies (STD) have a waiting period of 0 to 14 days with a maximum benefit period of no longer than two years.
  2. Long-Term Disability policies (LTD) have a waiting period of several weeks to several months with a maximum benefit period ranging from a few years to the rest of your life.

Disability policies have two different protection features that are important to understand.

  1. Non-cancelable means the policy cannot be canceled by the insurance company, except for nonpayment of premiums. This gives you the right to renew the policy every year without an increase in the premium or a reduction in benefits.
  2. Guaranteed renewable gives you the right to renew the policy with the same benefits and not have the policy canceled by the company. However, your insurer has the right to increase your premiums as long as it does so for all other policyholders in the same rating class as you.

In addition to the traditional disability policies, there are several options you should consider when purchasing a policy:

  • Additional purchase options
    Your insurance company gives you the right to buy additional insurance at a later time for an additional cost.
  • Coordination of benefits
    The amount of benefits you receive from your insurance company is dependent on other benefits you receive because of your disability. Your policy specifies a target amount you will receive from all the policies combined, so this policy will make up the difference not paid by other policies.
  • Cost of living adjustment (COLA)
    The COLA increases your disability benefits over time based on the increased cost of living measured by the Consumer Price Index. You will pay a higher premium if you select the COLA.
  • Residual or partial disability rider
    This provision allows you to return to work part-time, collect part of your salary and receive a partial disability payment if you are still partially disabled.
  • Return of premium
    This provision requires the insurance company to refund part of your premium if no claims are made for a specific period of time declared in the policy.
  • Waiver of premium provision
    This clause means that you do not have to pay premiums on the policy after you’re disabled for 90 days.