One of the most expensive propositions facing early retirees is the cost of health insurance until medicare kicks in at age 65. For traditional health insurance companies the age band from 60 through 64 carries the highest premiums, even for those in good health, while those in poor health may be denied coverage and have to resort to state HIPAA plans where premiums could exceed $3,000 per month. There is an alternative, however. Certain indemnity insurance carriers offer guaranteed issue health insurance with fixed, reasonable premiums.
Indemnity insurance differs from traditional major medical in that the insurance company pays a defined dollar amount for each procedure, period. For example, let's say for a doctor's office visit the defined amount is $100. If the insurance comany offers a preferred provider network (PPO) a visit to a participating doctor may cost $80, where a non-participating doctor might charge $130. In either case the insurance company pays $100---in the first scenario you receive $20 from them and in the second case they pay the doctor the $100 and you pay the doctor $30. This approach will certainly encourage you to shop around.
Similarly, in the case of hospitalization you may receive a first day benefit (ie: $3,000) and a daily benefit (ie: $1,500), which means that for the first day you would have $4,500 to spend---indemnity benefits can be additive. There is usually a surgical schedule (ie: 100% of medicare allowed) and a seperate anesthesiology schedule. Again, making use of participating network providers would be most prudent in such cases.
A guaranteed issue indemnity insurance policy may not be for everybody but might well be suited for certain early retirees, especially those facing what could be daunting health care costs while they await their medicare eligibility.
As a health insurance broker specializing in small businesses I vividly witness the need for health care reform on a daily basis and I fully support addressing that need, even at the risk to my own livelihood. There is much anticipation for reform in the marketplace I serve, especially the sole proprietors and husband/wife businesses, but much of that anticipation is based on an unsound premise that needs to be rapidly defused. Before announcing the specifics of a health care reform plan, whatever it might be, the American people at large sorely need to be educated about health care and responsibility. There are many Americans under age 65 who, probably due to rich employer provided benefits in the past, seriously believe that health insurance is an entitlement. Compounding that with the fact that the Democratic Party is now at the helm of government and billions of dollars have been spent on other programs, I hear on a daily basis the growing expectation of free health insurance in the near future. I’ve listened carefully to President Obama and, while I’m quite confident this is not going to be the case, I believe it is incumbent upon the President to lay some precise groundwork for the upcoming reform before the American people right away. The message should be, in a nutshell:
(1) Health care for those under 65 has never been an entitlement in
(2) It is the responsibility of government to ensure that the health insurance industry treats everyone fairly and without discrimination due to health conditions.
(3) It is the responsibility of every American to purchase health insurance for himself and his family.
(4) For those who might suffer economic hardship from purchasing a policy, the government will provide subsidy.
This message had better be sent now, before the growing expectation I mentioned above becomes so commonplace that even the best reform bill will be regarded negatively by the American public.
With the media attention to dental health over the past couple of years linking the buildup of plaque to heart disease it surprises me that the average American only goes to the dentist 0.6 times per year; especially since its standard knowledge that everyone should have their teeth cleaned and checked every six months. So, why don't people go to the dentist?
Some will honestly answer that they are scared of dentists or don't like pain but, considering the potential consequences of having to undergo dental surgery due to neglect, these are the folks who should be the most eager to endure a relatively painless oral exam twice a year. Certainly, the pain of a root canal should balance out the slight discomfort of a prophylaxis. Plus, many dentist also perform screens for oral cancer and take blood pressure as part of their twice a year screening service, certainly painless procedures that could be of great benefit.
Many will answer that they can't afford it. Yes, if you don't have dental insurance that routine, six-month checkup with x rays could cost in excess of $150 per person and with the current economic situation one might well argue that that money is necessarily spent on a trip to the grocery store. Quite true, so how about budgeting, say, fifteen to twenty dollars a month into a special account for dental? At least you could cover one visit per year. Even better, why not buy dental insurance on your own? Many health insurance companies now offer individual/family dental insurance that rival group dental plans with prices in that $15 to $20 range (family coverage in the $60 to $70 range). Plus, not only do these plans provide that visit every six months at no charge, they also cover other services such as fillings and even that root canal. If you do the math you'll pay less in premium for a dental insurance plan than you would on your own for just two preventive visits.
Hold it, you should be saying right now. That makes no economic sense for the insurance company---aren't they losing money on a deal like that? Go back to my earlier statement about the average American going less than once per year. That study was done on people who have insurance. My advice is, if you plan to look after your teeth dental insurance should be a no-brainer; you can beat the system and get more value back than you paid for.
I do have a word of caution for when you go shopping for a dental plan. Make sure you are buying dental insurance and not a discount plan. There are many discount programs available that give you access to a network at reduced rates but if you buy that type of program you will still have to pay something for each visit. With the cost of a true dental plan being so affordable it's well worth it to go in every six months and pay nothing for that visit.