What is private indemnity insurance?

Private indemnity or "fee for service" insurance can be obtained by individuals on their own, or through groups, such as employers or associations, and allows some level of choice of health care provider by the insured. When private indemnity insurance offers a more limited choice of providers, is it is typically referred to as Preferred Provider Plan, as your choice may be restricted to health care providers who are members of the sponsoring insurer's Preferred Provider Organization or PPO, or receive a reduced level of reimbursement when you see a provider who is not a member of the PPO.

I currently am on worker's compensation. Can my employer make me pay for my own health insurance while I'm off?

The employer generally has no obligation to maintain health coverage at its expense, although you probably have a right to COBRA it. Also, check the firm's long term and short term disability policies. Depending on what state you work in, your rights may be also different under some states' workers comp laws.

What is health insurance?

Health insurance is, basically, a promise by an insurance company or health plan to provide or pay for health care services in exchange for payment of premiums.

Health care in the United States is delivered and insured in many different ways.

Suppose the contract or booklet is ambiguous or unclear?

The law generally provides that the plain meaning of an insurance policy, plan or evidence of coverage governs its meaning and construction. The policy or plan must be read as a whole in order to determine the reasonable meaning of the terms and the intent of the parties, and be consistent with the intended goal of the insurance or plan. If, a policy or plan term is ambiguous, or there is a conflict between terms in the policy and/or evidence of coverage the law generally provides that the policy or plan language should be construed in favor of the insured or member and against the insurer or plan.

In addition to consulting both the policy or plan and the applicable evidence of coverage document, determination of what a coverage or benefit is requires, as to any particular coverage or benefit, a reading of all applicable "definitions," "benefits," "limitations," and "exclusions" contained in the policy or plan and the evidence of coverage.

Would I need a lawyer to handle my case?

Given the complexity of the legal issues involved and the tendency of insurance companies and health plans to vigorously defend claim denials, especially after appeal and grievance procedures, evaluation of any potential legal claim on behalf of an insured or plan member should be undertaken by an attorney experienced in insurance claims and bad faith litigation. Cases against health insurers and health plans resulting from claim denials, including bad faith remedies, are frequently undertaken on a contingency fee basis whereby the attorney investigates and evaluates the case before filing a complaint, advances the costs of investigation and litigation, and is paid attorney fees only if there is a recovery. In the event of recovery, the attorney is paid a percentage of the recovery as attorney fees. While the details of contingency fee contracts may vary from state to state, and within a state from attorney to attorney, as a general rule the typical contingency fee is 25 to 33-1/3% of the value of benefits or services recovered and 33-1/3 to 40% of any extra contractual or tort damages, such as emotional distress and punitive damages recovered.

How do I determine what my health care coverage or benefits are?

The primary insuring document is always the health insurance policy or the health plan service agreement; these are the binding contracts between insurers or plans and their insured or members. If the insurance or plan is obtained by an individual directly, the individual usually has a copy of the policy or plan agreement. In addition, or sometimes instead of the policy or plan, the insured may also have a summary or brochure, which is legally known as an "evidence of coverage." If you have health insurance or a health plan through an employer or group, you usually do not have a copy of the insurance contract or plan agreement, but rather only has a handbook, summary, brochure or other type of evidence of coverage. In either circumstance, it is the actual insurance policy or plan agreement that controls what the coverage and benefits are, with one important exception. Generally, the law provides that evidences of coverage, whatever their form, may operate to expand or increase the coverage or benefits available, but they may not operate to decrease or limit the benefits and coverage available below that which is provided in the insurance policy or plan agreement. Therefore, if there is any question about whether a benefit or coverage is available, you as an insured or plan member should read and compare the language about the particular benefit or coverage in both the policy or plan and the related evidence of coverage.

What are my legal remedies if a health insurance company or plan refuses to pay a claim for a benefit or service?

In a circumstance where an insurance company or health service plan (HMO) has denied a claim for a benefit or service, has upheld the denial through internal appeal and grievance procedures, and ERISA does not govern the policy or plan, an insured or plan member who has been denied a benefit or service can sue on a number of legal theories, including breach of contract, breach of the implied covenant of good faith and fair dealing (bad faith) and under some circumstances infliction of emotional distress and fraud.

The two primary legal remedies available in most cases are breach of contract to recover the value of the denied benefit or service and any incidental damages and bad faith. Bad faith is the unreasonable denial of a benefit and may allow recovery for emotional distress, interest on out-of-pocket losses, damages for any attorney fee obligations incurred and, in limited circumstances involving malicious or willful misconduct, punitive and exemplary damages. These legal remedies are ones that are available under state law, not federal law. In addition, especially with regard to the tort remedies of bad faith, infliction of emotional distress and fraud, the availability of the remedy and the nature and extent of damages recoverable vary from state to stat.

How does a health insurance policy or health plan protect me?

A health insurance plan or a health service plan protects an insured or member by promising to either pay for medical care or provide medical care. In the case of a health insurance policy traditional insurance provided that it would pay for any reasonable, medically necessary care required to treat an illness or injury. The insured, as a patient, was free to choose his or her health care provider, who would then in turn apply to the insurance company for reimbursement. While traditional fee for service health insurance policies are available, premiums for them have become very expensive.

In an effort to control health care costs, new forms of health insurance and health service plans have developed which have resulted in lower premiums. The lower premiums generally are achieved through a reduction in choice of health care providers, a reduction in the type and amount of benefits available, stricter controls on the type and amount of care given by providers and/or negotiated reduction of compensation to health care providers. These cost control measures include:

(1) limiting the health care providers the insured or member choose from to pre-approved list of health care providers,

(2) a requirement that any specialized care be can obtained only if recommended by a primary care physician, known as a "gatekeeper,"

(3) a requirement that any significant or costly care, such as any involving hospitalization, be pre-approved by the insurer or plan, and

(4) an application of aggressive utilization review which determines whether the care that was given was appropriate and not excessive.

I currently am on worker's compensation. Can my employer make me pay for my own health insurance while I'm off?

The employer generally has no obligation to maintain health coverage at its expense, although you probably have a right to COBRA it. Also, check the firm's long term and short term disability policies. Depending on what state you work in, your rights may be also different under some states' workers comp laws.

What is a health insurance plan?

A health insurance plan, or health service plan, is generally distinguished from health insurance by the type of promise that is made in the binding contract between the insured and the issuing company.

What to Ask Insurance Salespeople When Buying a Medical Insurance Policy

The recent legal problems of insurance companies such as MEGA Life and Health Insurance Company, NASE, Midwest National Life Insurance Company of Tennessee, Alliance for Affordable Services and Health Markets have prompted consumers to make sure they are not only getting the kinds of coverages they are paying for, but the kinds of coverages they need.

In order to do this, it’s important to know what questions to ask the salesperson or agent prior to buying. According to experts, here are some questions that you should ask your potential provider:

• What is the cost of the monthly premium, deductible, co-payment amount and cap? How does changing one amount affect the others?
• What does the policy cover? What does it exclude? Are there limits on the number of days the insurance company will pay for services such as prescription drugs, maternity or out patient services?
• Are pre-existing conditions covered?
• Does coverage begin immediately or am I subject to a waiting period?
• Is there a lifetime maximum cap the insurer will pay? This is important to know if you or someone in your family has a chronic or expensive illness or medical condition. Experts recommend that you choose a plan that has at least a $1 million maximum benefit.
• How do I obtain emergency care? Can I use urgent care facilities without pre-approval? Am I limited to using certain facilities in the plan?
• What else is covered? It’s important to find out if routine services, such as preventive care, immunizations and mammograms are covered under the policy.

A Stitch in Time…

It is better to get your questions answered up front instead of wondering if the amount and type of medical healthcare insurance you purchased will actually cover you when you need it. If you do decide to purchase the policy, make sure that all of the information you obtained is detailed in the policy.

Consumers should realize that many insurance salespeople are generally just that – salespeople. Unfortunately, many are more concerned with meeting quotas than they are about your personal well being. Part of what got MEGA and its partners in trouble was that their salespeople were never really informed about the products they were selling. Instead, they were taught how to sell and close the deal, leaving many policyholders without proper coverage.

If you need to find an attorney in your area to review your policy, or if you were a victim of one of the insurers listed in this article, click here to find an attorney who is a veteran in insurance matters.

What is the appeals and grievance process like?

What specific appeals and grievance procedures apply, and the extent and nature of legal remedies available, vary significantly from state to state, company to company, and often depend upon whether the health insurance or plan is or is not one covered by the Employee Retirement Income Security Act of 1974 (ERISA), as amended by the Multiple Employer Pension Protection Act of 1980 (MEPPA), typically collectively referred to as ERISA.

The original noble idea behind this federal law was protection of employee benefits and pension moneys from mismanagement or theft by incompetent or greedy trustees or by organized crime. Unfortunately, except for state laws that actually regulate insurance companies or health plans, ERISA also preempts (eliminates) any state law or remedy for insured or plan members that might otherwise relate to the administration of employee benefits, including health care insurance benefits, obtained through employment. In other words, as a practical matter, if a claim for health benefits or service is denied to a person who obtained health insurance coverage through employment, they are limited to the appeals and grievance procedures in the policy or plan and cannot sue in court for such things as breach of contract, breach of the implied covenant of good faith and fair dealing (bad faith), infliction of emotional distress, fraud, etc..

Typically, if the policy or plan is governed by ERISA, the only legal remedy outside of the policy or plan is to ask a court to review the claim denial decision to see if there was an abuse of discretion, which is extremely difficult to establish. Even if an abuse of discretion is established, the claimant is only entitled to receive the benefit or service that was originally denied, and that is often too late to help. In contrast, if the plan is an insured plan, and NOT subject to ERISA, the Insurer's Bad Faith can give rise to punitive damages.

Nearly 70% of the health care insurance currently in place in the United States is subject to ERISA. The balance of the health insurance in America is not subject to ERISA. The primary exceptions from ERISA are any health insurance policies or plans issued to individuals, and any group health insurance or plan coverage for employees of any state or local governmental agency or district, and any employee of a church or church affiliated organization. In addition, ERISA may not apply even if the health insurance coverage is obtained through private employment if the following four factors all apply: (1) the employer or employee organization did not contribute in any way to or any portion of premiums, (2) the participation in the employee benefit plan or program was voluntary, (3) the employer or employee organization did not endorse or administer the insurance and, (4) the employer or employee organization did not receive any commission or participation fee in connection with the insurance program or plan.

Are there any limitations on what an insurance company can charge for insurance?

For each type of policy, insurance companies have a range of premium levels that may be charged based on various factors that are considered at the time an application is submitted. For example, the premium for an auto insurance policy will vary depending on the applicant's driving habits, such as number of miles driven and whether the auto is used for business, the age and model of the vehicle, and whether the applicant has recently been convicted of a traffic violation. The premium for a life insurance policy will vary depending on the applicant's age and health condition. Rating factors must be reasonably related to the risk being insured, and state law often limits the specific rating factors that may be considered for certain types of insurance.

The rates and rating factors for most types of insurance must be filed with the insurance regulatory agency for each state where the insurance is to be sold. In some states and for some types of insurance, the rates must get regulatory approval before they can be used.

How long will my medical insurance allow my new baby and myself remain in the hospital following childbirth?

Because many insurance companies would not pay for hospital costs beyond the bare minimum, Congress enacted legislation that allows mothers and their newborn infants longer hospital stays. The law requires, among other items, insurance companies to pay for at least a 48-hour hospital stay for mothers and their newborns after a regular delivery. The legislation provides for a 96-hour hospital stay if the baby is born through a caesarean section. (The legislation follows on the heels of several states that have enacted similar legislation, but due to loopholes many insurers escaped enforcement of states' laws since they are regulated by federal law.)

What can, or must, I do when a health insurance company or plan refuses to pay a claim or provide a benefit or service?

If a health insurance company or plan denies a claim or refuses to provide a requested benefit or service, it is very important that the insured or member immediately review the policy, plan or evidence of coverage document relating to claim or benefit denial, appeal or grievance procedures. Most often, there is a requirement that the insured or member appeal a denial of a benefit or service with a written appeal within a period as short as 15 to 60 days. In addition, there are typically multiple levels of appeal or grievance, which are mandatory and which involve subsequent short time limits. Appeal or grievance procedures, depending on the policy or plan, either require that final determinations of entitlement to benefits or services be made by required arbitration, or they allow the insured or member to file a lawsuit, but only after exhausting the appeal or grievance procedures set forth in the policy or plan. While legal assistance from an attorney is not necessarily required at the initial levels of appeal, it is strongly urged as soon as possible if the amount involved is large, or the insurer is contending the treatment you need to live is "experimental" or the matter is going to any arbitration or lawsuit. Rest assured that the health insurer or plan will almost certainly be represented by an attorney, and s/he or he will be out to have your claim denied.

How long will my medical insurance allow my new baby and myself remain in the hospital following childbirth?

Because many insurance companies would not pay for hospital costs beyond the bare minimum, Congress enacted legislation that allows mothers and their newborn infants longer hospital stays. The law requires, among other items, insurance companies to pay for at least a 48-hour hospital stay for mothers and their newborns after a regular delivery. The legislation provides for a 96-hour hospital stay if the baby is born through a caesarean section. (The legislation follows on the heels of several states that have enacted similar legislation, but due to loopholes many insurers escaped enforcement of states' laws since they are regulated by federal law.)

What can, or must, I do when a health insurance company or plan refuses to pay a claim or provide a benefit or service?

If a health insurance company or plan denies a claim or refuses to provide a requested benefit or service, it is very important that the insured or member immediately review the policy, plan or evidence of coverage document relating to claim or benefit denial, appeal or grievance procedures.

Most often, there is a requirement that the insured or member appeal a denial of a benefit or service with a written appeal within a period as short as 15 to 60 days. In addition, there are typically multiple levels of appeal or grievance, which are mandatory and which involve subsequent short time limits. Appeal or grievance procedures, depending on the policy or plan, either require that final determinations of entitlement to benefits or services be made by required arbitration, or they allow the insured or member to file a lawsuit, but only after exhausting the appeal or grievance procedures set forth in the policy or plan.

While legal assistance from an attorney is not necessarily required at the initial levels of appeal, it is strongly urged as soon as possible if the amount involved is large, or the insurer is contending the treatment you need to live is "experimental" or the matter is going to any arbitration or lawsuit. Rest assured that the health insurer or plan will almost certainly be represented by an attorney, and s/he or he will be out to have your claim denied.

My father who has conjestive heart failure and type 2 diabetes recently underwent a quintuple heart bypass. His medical bills are staggering and he ha

You could offer to pay immediately at the same discounted level those bills would have been paid by a health insurer (Blue Cross and HMO have agreements with the hospital and medical/surgical providers to substantially discount bills). That's a very substantial discount from the full "list price".

If that offer is not accepted, when he is sued, he might be more successful by saying the discounted price is the "reasonable and customary" price, rather than the list price they are seeking to collect. This approach is based on the fact that the discounted rates are what they receive on the majority of payments. He could do extensive pre-trial discovery to make them disclose their actual reimbursement rates (they would likely settle rather than disclose).

This whole process could be handled far better with the help of an attorney. If you don't have the money and fear bankruptcy is his only recourse, see a bankruptcy lawyer soon as Congress is about to change the bankruptcy laws and make it very difficult to wipe out bills.

What are typical problems that arise in getting health care benefits provided or paid?

Coverage and benefit disputes in health care insurance and health care service plans that frequently arise include the following:

(1) The insurer or plan contends that care was not "medically necessary," which is often defined as care which is reasonably required according to accepted norms within the medical community.

(2) The insurer or plan contends that the charges were not "usual, customary and reasonable" for the services rendered.

(3) The insurer or plan contends that the treatment was "experimental" or "investigational," which generally means that the care has not been accepted in the medical community as normal treatment or treatment that has not been proven to be effective medically.

(4) The insurer or plan contends that medical care was received outside a specified geographical service area and was not emergency care.

(5) The insurer or plan contends, with respect to extended care especially, that the care constituted "custodial care" or "long-term rehabilitation" which are usually excluded from coverage. This issue often arises in the context of persons confined to skilled nursing facilities or persons requiring home health care.

(6) Coverage in a replacement policy that is substantially and impermissibly different (more limited) than that in a group policy it replaced.

(7) Substantial differences between descriptions or terms in the evidence of coverage (member handbook, disclosure form or summary) and the insurance policy or health plan contract in the circumstance where the denial of coverage or benefit is based on the evidence of coverage, not the contract.

(8) Substantial ambiguity in a particular term, definition, benefit or coverage description, exclusion or limitation, or an ambiguity created by an interplay between or among the different provisions.

(9) The insurer or plan attempts to effect a reduction in or elimination of a benefit or coverage contrary to a provision in the policy or plan, or without adequate notice.

(10) The insurer or plan seeks recession or cancellation of the policy or plan alleging that an insured or member had a preexisting condition not revealed in the application.

Check here for a helpful article on dealing with insurance companies when you have a high risk illness.

What will happen to our health insurance for my dependent children and I after the divorce from their father?

Your husband may keep the children on his policy. However, as you are no longer married you are no longer eligible for coverage on his policy. However most plans offer a conversion package to individual coverage under COBRA, a federal law. The cost of insurance is usually the responsibility of the separate parties after a divorce. However, coverage for the children may be available.

Are there dangers in cancelling health insurance?

There can be potential serious adverse consequences associated with canceling health. If you cancel health insurance before replacement health insurance coverage is confirmed and already available, there may be a gap in your health insurance coverage.

First, there is no assurance that you will be able to obtain new health insurance. You might be denied coverage due to health conditions that developed prior to applying for the new insurance or plan, or go completely uncovered during the underwriting process. Second, even if you are accepted for subsequent health insurance coverage you could face a situation in which certain medical conditions that developed during the prior health insurance coverage are excluded from coverage under the new insurance as "preexisting conditions."

These problems may not exist if you are moving from one group insurance plan to another, as many group policies ignore pre-existing conditions if you move from a similar group health coverage within 30 days of prior coverage. A second exception will probably result in the same continuation of coverage mandated by HIPAA on and after January 1, 1998.

What is health insurance?

Health insurance is, basically, a promise by an insurance company or health plan to provide or pay for health care services in exchange for payment of premiums.

Health care in the United States is delivered and insured in many different ways.