Hygeia Note:  On March 30th, Disruptive Women in Health Care launches the first of its monthly in-person breakfasts.  Among our speakers will be Stephanie Cohen.  Her post appears below.

By Stephanie Cohen.  This month’s health insurance nightmare: Dad is still paying for his daughter’s insurance — and no one is happy.

The situation: I received a call last week from a client whose daughter recently told him she hates her insurance “because it does not cover anything.” He phoned me to see if she had a real gripe, and if I could help him find another policy with better coverage for her.

The problem: It turned out that her policy had a $5000 deductible, which did not include coverage for dental or vision doctor visits. Since she has an entry-level position and not a lot of extra spending money, I told her she had a choice.

She could choose to pay more per month to lower her out-of-pocket expenses, but her monthly premiums would be higher. Since her father was paying her premium, and was happy to do so, I decided the best policy for her was one with a higher premium and lower expenses.

The solution: The decision to pay for an adult child’s health care is a personal one that each family must make, of course. The reality is that once a child turns an age selected on the policy by the plan administrator based on the rules of the state and the size of the employer, they are no longer considered a dependent.

Many times, the insurance company does not notify the parent or the plan administrator that the student has been dropped. The student typically finds out when filling a prescription or when receiving services. 

Keep in mind that it is the parents’ responsibility to notify the carrier that the student is or is not a full-time student and is eligible for coverage. The student is responsible for having a student certification form completed and signed by the bursars office proving they are in school fulltime with 12 plus credits.

If I were the Health Insurance Ambassadors: All students would have to prove they had coverage or they could not attend school.

Although with the recent health reform legislation there is now a new Federal mandate to allow children to be on their parents health plan until 26, it still may be less expensive to insure that child unto themselves rather than remain on the parents plan.  Obviously, the rates will be much lower for someone who is much younger.

The painful truth: Parents can analyze the cost of coverage through the school or an individual policy versus the cost of keeping the child on his/her plan. If the parent has other children on the plan, it rarely saves to pull one child off the plan.

 I encourage you to share your insurance nightmares with me.

By Stephanie Cohen. This month’s health insurance nightmare: You believe the cost of your policy is too high and the benefits too low.

The situation: Sara E. was looking at new insurance options because she was concerned that her current policy cost too much and covered too little. A case in point was a recent eye exam. She had to pay for the appointment because she hadn’t yet met the $1000 deductible on her current policy.

The solution: It was clear that Sara did not understand the details of the policy she had purchased. It’s not unusual, but can prove problematic. In fact, we recommend that all of our customers make a list of the medical services they will likely need throughout the year. Before buying anything, we tell them to read the fine print on the policy and ask questions until they are certain they understand what they are paying for – and what will be an additional charge.

Here’s why: The fine print on an insurance policy can be complex. The bottom line is that if you purchase a policy with a high deductible, there will be no coverage until the deductible is paid in full. Deductibles apply to all coverage if you purchase an HSA (Health Savings Account) compatible plan – except for preventative services.

And realize this:

1. Deductibles can also apply to specific services such as lab work and hospitalization.

2. They also apply to services differently depending on whether they are in or out of network.

3. It’s important to know that deductibles may be cumulative or shared, or based on the calendar year or contract year. Know how it works for the policy you purchase.

4. If the policy is a Health Savings Account (HSA) versus a high-deductible plan, you will be able to write off the amount placed in the HSA account up to the maximum allowable by the government. The minimum deductible for HSA plans start at $1200 for a single and $2400 for a family.

5. Do note that there are many after-tax expenditures such as those that are included in the FSA Section 213 of the tax code, which can be written off that are not covered under an insurance policy, which is the advantage of an HSA.

If we were the Health Insurance Ambassadors

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Think you have maternity coverage? Think again.

Welcome to the first entry of the book I’ll be publishing in 2010 entitled: You gotta laugh: Life in the trenches of the health insurance business. Because I think Disruptive Women readers will find it useful, each month I’ll post an example of a health insurance problem that is so maddening and frustrating that we just gotta laugh at its absurdity.

My goal, however, is to find a way to improve health insurance for beneficiaries and I have some suggestions at the end of this post.

This month’s question: What do you do when you have it in writing from your insurance company that you have maternity coverage — but when you go to use the benefit, the customer service department tells you otherwise?

The situation: When our client, Ms. R, found out a few years ago that she was having a baby she was thrilled. Immediately, she called the insurance company to confirm her pregnancy benefits. Making the call was merely a formality. When she originally purchased the policy, she was single and didn’t opt for the maternity rider. After she got married, she added maternity coverage because she wanted a family.

Indeed, when she called the insurance company, they confirmed she had the insurance she needed. However, after her first OB check-up she received a letter saying she was, in fact, not covered.

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The fact is that although nearly 250 million Americans do have health insurance, according to a monthly survey of about 50,000 households done by the Bureau of Labor Statistics and the Census Bureau, an estimated 46 million Americans do not.

Listed below you’ll find arguments for not having health insurance that I hear on a regular basis. As a broker, I’ve provided a reality check for individuals to consider before making their final decision.

1. It costs too much.

The reality: Should a catastrophic illness or injury occur, it would likely bankrupt most people who do not have health insurance. It’s the terrible fact of life in 2009. Medical care is incredibly expensive, and employers are increasingly less likely to be able to support an injured or ill employee. So if something happens to you, and you have not saved enough money to support yourself if you are unable to work, odds are good that you will be in debt for astronomic health care bills and, unfortunately, many of us would be hard pressed to ever climb out of that financial hole. Don’t be scared. Just think long and hard about that.

2. It does not cover all of the health care needs that I have now, or might have in the future

The reality: The truth of the matter is that a good health insurance broker can usually find a policy that covers most every medical problem that is likely to arise. There are also resources that can be used to supplement your plan. For instance, if you need discount drugs, it is possible to fill your prescription at Wal-Mart or in Canada. Need a flu shot? You can get one at your local pharmacy. My mother always told me, “where there is a will, there is a way.” I believe that to my core. You just need to be clever and work at solving your own problems.

3. The drug benefit is insufficient on most health care plans.

The reality: See above. And do remember, you are your own best health care advocate. The health insurance plans cover many things, but you need to do some legwork to get everything you want and need for your own care.

4. The process of finding the right health insurance is too complicated.

The reality: Honestly, it really is not. Think about the old adage — “How do you eat an elephant? One bite at a time.” The same applies to health insurance. People think that the process of understanding a policy is just too difficult, so they tend to shut down before they even try to take the time to comprehend it. Don’t give up too soon.

5. I have a specific health issue that was not covered satisfactorily in the past, so I’m not inclined to buy health insurance again.

The reality: Please realize that not all policies are the same. There is definitely one that is right for each individual. Plus, there are often state-run programs that can address most insurance needs. If you had an issue it is likely that someone else did too, so take solace in the fact that you are not alone.

6. I am healthy and do not need health insurance today.

The reality: That’s true. Until, of course, you do need it. You will. You are human. Humans get sick and often need to see a doctor. So please, do not be stupid. Protect yourself against what is more than likely to come. In the case of a catastrophic incident, this ignorant assumption cannot be undone.

7. Obama will help me get free insurance.

The reality: I cannot believe how many times I have heard this in the last few months. I am the first to admit that President Obama is doing his best, but please stay grounded in the facts. The U.S. government is not going to give everyone a free health insurance policy. Unless you are very poor, forget this as an option. Take care of yourself today and buy an affordable health insurance policy.

8. I want to wait until health insurance is cheaper.

Having been in this industry for more than two decades I can speak from experience that health insurance companies are not in business to help you. Insurance is not going to get any cheaper — at least, not any time soon. It is heretic to admit, but insurance companies do not make billions for their shareholders by helping the little guy. We are easy targets. We have no lobbying power, and they know it.

The bottom line: Be smart. Buy a health insurance policy that will at least cover you in case of a catastrophic event. Health Savings Plans are a good option, and more solutions are coming on the market. The bottom line is that if you take care of yourself, you won’t regret it.

As an insurance broker in the metro Washington DC area, I have been in the trenches of selling, and advocating for our customers for their small group health insurance, disability programs and life insurance plans for over 17 years.

Needless to say, it has been maddening in the last five years to watch rates rise and our customers get increasingly frustrated with the system. I spend my days arguing with insurance companies about what they will cover and what they won’t — and I’m consistently amazed that these large firms often don’t have a handle on the benefits they provide in their policies. To say the right hand doesn’t know what the left is doing is a dramatic understatement.

I am one of the first to admit that something needs to be done. Last fall I hosted the DC Health Summit and brought together some of the country’s top health insurance executives, doctors, politicians, hospital administrators and business people into one room to discuss what might be done to fix the system.

An Obama spokesperson was one of our speakers — and today I continue to stand behind the president’s goal to accomplish health care reform, and do it as soon as possible.

As the debate has unfolded, however, it has been suggested that health insurance brokers be eliminated from the mix. Obviously, this potential threat is unnerving, but if you consider the possibility on a more global level — it simply doesn’t make sense.

Here’s why: If we have a government option in health care reform, over a short period of time, it will likely crowd out the private sector. If private health plans are squeezed out of the market, it follows that insurance agents will be as well, and that would be a major loss — not just for my firm, but also for every American who currently relies on their broker to explain their benefits and advocate for them when there is a problem.

I believe it is critical that the broker not be categorized as an administrative cost — especially as those costs are the biggest target in the reform packages. We also want to make sure Congress doesn’t do anything that removes us from the system, or removes the value that we know we add for the customer.

So let’s consider the doomsday scenario for brokers.

If the current threat comes to fruition and brokers like myself are put out of business, I’m certain there will be a consumer advocate of some sort under any new model that is adopted. Like with many government-run programs, will these be poorly trained people be truly knowledgeable about how the system works? Will they be advocates for their customers? Will they have the time, resources, or incentive to spend five hours on the phone in a day — as I often do — arguing for a patient’s health insurance rights?

Not likely. Indeed, odds are good that we’ll end up with internet-based FAQ pages filled with complex explanations. I can foresee the day when trying to understand your health insurance benefits will resemble trying to understand how to do your taxes. Will we look back on these days as the good times for our health insurance benefits?

Needless to say, I believe strongly that brokers are an important part of the health care system. I hope to have the privilege to continue to do my job for many years to come.