Health Insurance Articles
Three Ways To Assess The Strength Of Your Health Insurance Coverage
2010-07-19
Today, it is imperative and essential to have reliable and dependable health insurance coverage to offset the exponential inflation of health care costs. Despite the recent legislation that institutes restrictions and limitations on exclusions and the rescinding of health insurance coverage, policyholders must be proactive and ensure insurance strength and dependability. Therefore, policyholders should investigate and evaluate the insurance company's size, financial stability including revenues, assets, and rating, and sustainability regarding claims experience and customer satisfaction.
It is critical to examine an insurance company's financial status. Health insurance rating systems compiled by independent companies such as AM Best can provide this information. The company's longevity is another reliable indicator of stability. Newer companies may make extravagant service claims and offer increased coverage, but it will not be known whether the company will withstand the test of time. The National Council of Insurance Commissioners (NAIC) also provides financial data on insurance companies including financial reserves, financial resources, and assets. The company's size is consequential, and its history of rescissions and cancellations of coverage are equally important. Unequivocally, it is mandatory to investigate the company to ensure that it has adequate financial resources and revenues for stability.
A company's loss ratio is a major factor in determining sustainability. Its ability to process claims in a timely manner, usually through a third party administrator within 10 days or less is indicative of financial stability. The NAIC produces an annual report on health insurers' claims experience and ratios. Rate increases are another critical area. For example, a $300 annual increase seems rather insignificant; however, over a 20-year period, it undergoes a metamorphosis and becomes $20,000, then multiplied by thousands of policies. Consequently, it is important to consider and compare prices, as well as the amount and frequency of rate increases, and then recognize that an insurer with stability has few fluctuations. Additionally, public records should be reviewed for litigation and suits against the carrier and the subsequent resolution.
The final evaluative tool is the company's reputation, level of customer satisfaction, and policyholders' recommendations. Simply viewing the company website will provide customer feedback, compliments, or complaints that are invaluable in estimating a company's performance and sustainability. Additionally, a solvent, stable and sustainable company will offer essential services: good prescription coverage, preventative care, comprehensive inpatient and outpatient services, reasonable deductibles, therapy services, mental health care, alcohol and drug rehabilitation, home health care, and affordable co-pays. All of these are important considerations in assessing the health insurance strength and reliability.
In conclusion, a policyholder should utilize caution, exercise wisdom and inductive and deductive reasoning, examine finances, and obtain candid customer comments regarding a company's health insurance coverage.
