2011 > August

Monthly Archives: August 2011

Picking a Health Plan: HMO vs PPO and Beyond

Choosing a health plan for you or your family may seem daunting: HMOs, PPOs, high deductible plans, different premium tiers, etc. Like everything else we buy, we want to find the best. However, this mindset may set you up for disappointment, frustration, or even worse, choosing the wrong plan for your situation. Why? Because with health insurance, there is usually no “one best plan.” Rather, there are different plan options, and people with different needs and preferences. So your goal should be to find the best plan for you.

Before you choose a health insurance plan, think through your own preferences and focus on one question:

What is most important to YOU in your health plan?

1)    I want to stay with the same doctor.

If this is your biggest priority, you should call your doctor and ask which insurance plans they take. Be sure to ask about the specific type of plan, not just the insurance company’s name, because some doctors may for example, belong to an insurer’s PPO network, but not their HMO network. Most plans will give you a printed provider network or make one available online. However, these lists can change frequently, so it is best to check with your doctor for the most accurate information.

2)    I want to be able to see any specialist I want. 

These plans have become more and more rare, since most insurers have created provider networks, or lists of doctors who will be covered.  Plans that have no physician networks are called Private Fee for Service (PFFS or just FFS). You do not need a primary care physician or a referral to see a specialist. However, these plans are rarely offered outside of Medicare today.

The next closest choice is a PPO. These plans offer better coverage when you see a physician within their network (usually around 80%) and less coverage when you see an out-of-network physician (usually around 50%). So you can still go to any doctor, but just expect to pay more out of network.

HMOs are the most strict about what they will cover. They will only cover services from providers in their network and require a referral from your primary care physician for you to see a specialist.

3)    I don't like having to get a referral to see a specialist.

If this is important to you, a PPO will work better than an HMO. You do not need referrals, and if you stay with the plan’s provider network, you’ll be able to get the best coverage.  The main drawback is that HMOs are generally much more affordable insurance than PPOs—lower premiums, co-pays, and coinsurance.

4)    I am willing to pay more on the front end to avoid high costs on the back end.

Insurance is about risk—we pay a little bit in each month, so that it will repay us a bigger sum we need it. Some people prefer the security of knowing that anything that happens will be fully covered and are willing to pay a high premium for this. PPOs generally work better for this type.

5)    I would rather pay low premiums now, even if it means I would have to pay more if I get sick.

In contrast to those in #4 above, some people would rather pay less each month, and gamble that they won’t need to use their health plan. For this crowd, a plan with lower premiums and either a high deductible or high co-insurance would be more appropriate. HMOs or high deductible plans (whether they are PPOs or HMOs) generally work better for this type.

So really, the plan you pick is really driven by your personal preference.  Get clear on what is most important to you, and let these values guide your comparison of HMO vs PPO or high-deductible vs low-deductible. Most of the time, this is far more reliable than looking for the plan that is rated the best or that your trusted co-worker chose. Let go finding the best plan of all, just the find the best plan for your own needs.

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One Patient’s Story: the Cost of the Surgeon’s Glue Gun

Whenever we are telling people about Simplee we are struck by how everyone always has some story about getting overcharged by a provider, rejected by an insurance company, and generally bumped around in a system that is decidedly customer unfriendly.

This story comes from Baat, who was pretty surprised when a doctor turned “surgical adhesive” into “surgery” and charged her $900 to fix a small cut on her son’s head.

Our story begins last March, when our 5 year-old fell and bumped his head on the ground. Nothing major, a little bit of blood, but I decided to take him to the Palo Alto Medical Foundation Pediatric urgent care, to clean it properly, and evaluate the damage.

We were seen first by the assistant, who cleaned and inspected the wound, and then the doctor examined it and determined it to be a minor gash. She also performed a physical examination to make sure no additional issues were caused by the fall (concussion, motor skills, etc.).

Since the wound was still mildly bleeding, we were offered to have a small amount of glue applied to his injury, as it was too small for stitches. The alternative was a bandage, but that seem difficult to keep in place on his head, so we asked for the glue. The actual procedure took about 5 min (although 15 min was spent waiting for the local anesthetic to absorb to take away the sting of the glue). Our entire visit (most of it spent waiting) was under an hour.

We currently have a High Deductible Health Plan (HDHP), which means this type of treatment comes out of our pocket. I was therefore curious to get the bill, hoping it wouldn’t be high.

A few days after the treatment I received an email from my Simplee account. I was shocked to see the bottom line: $888. In addition, we noticed the insurance company classified it as “surgery”.

Being notified so close to the event by Simplee (rather than waiting for weeks for the bill), while I have all the details fresh in my mind, helped us compose a letter to dispute the charges with the care provider. We basically wanted them to classify the treatment differently, since we didn’t see how a situation that was offered a bandage as a treatment, could become so expensive, and carry the title of “surgery”.

Today, our case is still in dispute, but last I heard from PAMF, they will change the classification of the bill.

In an ideal world, knowing (even ball-park numbers) how much a visit to the doctor could cost us, or the cost of using glue versus a bandage, would empower us to make better decisions. Had I known such a visit would result in hundreds of dollars, I probably would have cleaned the wound myself put a bandage at home.

From a financial perspective, doctor visits feel like walking in the dark. You have no clue of the associated costs, and you let the care-providers and insurance companies run the show. But as we are encouraged to move to HDHP, and incur more out-of-pocket costs, creating a more transparent system is crucial.

Simplee’s approach, of notifying users quickly after events occurred, and having all the details in one place, showing costs, where the money is going, and hopefully one day alternative options, is a big player in empowering health-consumers. This bottom-up approach, letting users have the information they need to make smart decision is an important step in fixing this broken beast we today call “our health and insurance system”.

One way of looking at this is to say the system is working—the idea behind high-deductible plans is that by pushing more of the expense on consumers they will make people pay more attention and drive costs down.  However, as Baat points out, the consumers in this equation have very little information and very little power.  Finding mischarges takes time and attention, and fighting them takes tenacity.

Simplee can’t change what providers charge, but we do try to make it easier for you to dispute claims.  Next to each claim detail we provide the contact information for your provider and your insurer so you can contest the bills you disagree with.  And of course getting the info in a clear and timely manner is very helpful.  So make sure to check each claim as it comes in to see that everything is kosher… and surgery-free.

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Thanks to the “Love That Max” blog!

Many thanks to Ellen Seidman of the blog “Love That Max” for mentioning Simplee in a post last Saturday.  Who are Ellen and Max?

Some people look at Max and see only a child with disabilities, I know. But there are many, many Max miracles. The little ones happen whenever he says a new word or sight reads a new word or runs down our block, doing stuff doctors never thought he would. It’s also a little miracle every single time he smiles—I swear, sunshine shoots out of that kid.

And then, there are the big miracles. Like the fact that a doctor told us we could sign a Do Not Resuscitate at Max’s birth and now, look at him. And how much progress he’s made, and keeps making. And, most memorable of all, the day he took his first steps. That was Miracle Day.

When you work at a start up there are a million different things to focus on every day—emails and metrics and stats and tasks and presentations and meetings and all the little things that keep a day busy.  And then you read about Ellen and Max and you remember what it’s all about.

At the end of the day, we here at Simplee are excited to be creating something that helps real people solve real problems.  Dealing with medical bills is such a huge pain point for so many people, and it is all the more so for those who, for one reason or another, have a lot of them to deal with.  We are glad to be able to make at least one part of their lives easier.

Thank you, Ellen and Max!

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What Will It Cost?

American consumers have a wealth of information available to them to help them make smart choices in the market place.  Looking to buy a house?  There are many sites that will show you listings and what other houses in the area have sold for.  Looking to buy a car?  You can easily find the best price on a Honda Accord in the area.  Looking to figure out how much to pay for a mammogram?

Oh.  Not so easy.

The truth is, many people haven’t had to worry about exactly how much health care cost, because their employer-provided plans covered most things.  But as employers (and the self-employed) look to cut costs themselves, high-deductible plans are becoming more and more common.  With these plans a lot more of the cost of care comes out of your own pocket, so suddenly smart shopping makes a lot more sense.  But what’s the best way to get it done?

Ask your friends.  In the past the way you learned where to find the best deals was to talk about it with people you knew and trusted.  These days social networking makes that even more efficient.  Healthcare Savvy is a new site where patients can exchange information on procedures, providers, and costs.  You can ask questions, share experiences, and post tips, all with the goal of crowdsourcing smart health care.

Look it up.  Sites like Healthcare Blue Book and Clear Health Costs use information from a variety of sources to suggest average prices for various medical procedures.  Healthcare Savvy has a good article up that reviews some of these health care cost comparison sites.

Ask your provider.  Of course another good way to figure out how much something will cost is to ask your provider.  If your doctor suggested some lab tests, you might ask how much they cost so you at least know ahead of time.  Do be aware, though, that the cost can vary depending on what kind of discounts your insurance has negotiated, and some providers won’t even know what the proper costs should be. 

And of course, you’ll also want to use Simplee to get a good idea of your historical costs.  If you get a yearly mammogram, for example, you can compare the cost between the years and ask questions if there is a difference.  Sign up for free account and start managing your health care expenses today!

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From the Simplee Community: “Simplee Has Made It Very Clear To Me.”

Many thanks to Simplee user David for writing us this story about how Simplee gave him peace of mind after the birth of his new baby:

As my wife was going through her pregnancy for the past 9 months, many things went through my mind.  Of course there was joy, excitement and great anticipation of the big day, but there was also anxiety.  We didn’t know if everything would go well, if the baby would be healthy, if we would need a C-section, or if we would have problems dealing with insurance.  The cost of everything would be so high without insurance paying for it.

I was very excited when I first read about Simplee on TechCrunch.  I thought that health insurance simplified would be great.  I already have similar service for banking (Mint) and I was very happy with them, so I jumped on the chance to get into the private beta.  It worked just like I thought it would.  Bills charged to my health insurance would show up on Simplee, and it was very clear to me whether or not a claim was successful, or if it was denied for whatever reason.  It would also tell me the amount that I am responsible for paying in every claim.  If a claim was listed as denied, it would state the reason and show clearly that I was not responsible for paying the rejected amount.  It definitely gave me peace of mind that I understood the claims, because reading the health insurance statements directly, they make things so complicated!

During the week after the baby’s delivery, you can imagine that everything was very hectic.  Relatives visiting, bringing the baby home, taking care of my wife, visiting the pediatrician for the first time—the last thing we wanted to worry about is whether or not we would be charged tens of thousands in bills.  Thankfully, Simplee has made it very clear to me what is going on.  I would definitely recommend everyone join Simplee to get an understanding of your health insurance.

Thanks for the kind words, David, and congratulations on your new baby!  To experience how easy your medical bills can be with Simplee, get started today with a free account.

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