Life shrinks or expands in proportion to one’s courage.
‘The Diary of Anais Nin, volume 3, 1939-1944’
Life shrinks or expands in proportion to one’s courage.
‘The Diary of Anais Nin, volume 3, 1939-1944’
I played a little golf yesterday. And I won $50 with an 18th hole 6-iron approach shot from 185 yards away that ended up about 10 inches away from the hole. I felt like I earned that money.
Our newest infographic features some pretty shocking facts about our plastic surgery obsession. For example, teenage plastic surgery is on the rise. There were 14,000 procedures performed on teens in 1996, compared to 77,000 in 2011.
Super interesting on many levels, especially regarding the cost of these procedures. For example, an appendectomy at an outpatient surgical center costs $47,000 and takes 45 minutes or so to do by a general surgeon. The cost of a facelift, done by a highly skilled plastic surgeon, can take hours.
This is what happens when competition and paying for something with your own money, not an insurance company’s money, infiltrates healthcare. Costs decrease significantly and they mimic the actual cost of a procedure, not some arbitrary, highly inflated number.
One of the awesome things we do at Sherpaa is help companies get the perfect insurance plans for their company— one that meets the needs of their employees and one that saves the company and employees money. We do this by working with a very curated group of brokers. A great health insurance broker can be one of the best friends a business owner could ever have. They will look out for the best interests of your company, while providing you guidance as well as compliance through the difficult terrain in the health care industry. But how do you know how to select a great one? There are a few key things to consider:
- Determine exactly what sort of support you want from your broker. Smaller businesses without an HR department may require more support than larger companies. Before selecting a broker, it’s good to know exactly what your needs are.
- Reputation is everything. Therefore, a great place to start is to ask for recommendations from companies that are similar to yours in both size, location, and demographic. Make sure to ask for references, licenses and registrations from all potential brokers. You can also do your own due diligence by checking their disciplinary record through your state’s insurance commissioner’s consumer hotline. In New York, that number is 800-342-3736.
- Ask all potential brokers for specific examples of how he/she has helped businesses similar to yours. It’s important that you fully understand exactly what they can bring to the table.
- Find out what plans the broker is qualified to sell. Not all brokers are able to sell all types of plans. Be sure that understand exactly what the broker is able to do, and ensure that it meets the needs of your company
- Ask whether you will have a dedicated account manager who will handle your day to day concerns. Many brokers simply don’t have the time to offer this level of service, and that may be a consideration for you. If the broker is able to provide you with a dedicated account manager, be sure to ask how many other businesses the manager is servicing so you can understand the level of attention you might receive.
- Ask what hours the broker (and, if applicable, the account manager) works. It’s important that they are available for you when you are going to need assistance. For example, we have seen some brokers who close shop at 4pm. If your end of day isn’t until 7, that may be a concern.
- Ask how renewals are handled. Some brokers wait until less than 10 days prior to renewal to begin the process. This can leave you with no choices, and a potentially sky high premium increase. Find out the exact timelines for when this is handled.
- Premium increases. Try to get a sense, with specific examples, of what the brokers’ current clients have experienced in terms of premium increases year to year. This helps not only with your own financial forecasting, but also allows you to get a sense of the type of relationship the broker has with the insurance carriers.
- Keep in mind that brokers get paid on commission. This commission comes either entirely from an insurance company, or as a split between you and the insurance company. It’s important to keep your eyes wide open on this one. If the broker is getting paid from the insurance company (even in part), whose best interests will he/she really have in mind?
- Is your broker keeping you compliant? With the implementation of the Affordable Care Act, the list of compliances that a company must have has become quite large. A great broker will help you not only navigate what you need to know, but handle the compliance for you. It’s important to ask how involved they will become in this matter.
If your selected broker is meeting all of the requirements above, congrats…you have a great broker. However, if the broker is not or has not met even one of these requirements, it’s time to search for someone new. Health Insurance is the second largest expense a company has after payroll, which means it is too important to leave in the hands of someone doing less than excellent work. We’ve already done the work for you here at Sherpaa. The brokers we work with are amazing.
One day in 1976, Moraitis felt short of breath. Climbing stairs was a chore; he had to quit working midday. After X-rays, his doctor concluded that Moraitis had lung cancer. As he recalls, nine other doctors confirmed the diagnosis. They gave him nine months to live. He was in his mid-60s.
So he moved back to The Island Where People Forget to Die. And his cancer went away. Today, he’s 97 years old.
How does he think he recovered from lung cancer?
“It just went away,” he said. “I actually went back to America about 25 years after moving here to see if the doctors could explain it to me.”
I asked him, “What happened?”
“My doctors were all dead.”
Reminds me a bit of the lovely Willie Nelson song, I Gotta Get Drunk:
There’s a lot of doctors that tell me
That I’d better start slowin’ it down
But there’s more old drunks
Than there are old doctors
So I guess we’d better have another round
Over at the Sherpaa blog, we’re creating some content to help companies fully understand healthcare. Here’s episode one.
An important part of our job here at Sherpaa is helping our clients understand healthcare. As we all know, it’s super complicated and when you’re the CEO concentrating on building the awesomest company you can possibly build, you just have no time to dive into the nitty gritty of all these details. Unfortunately, without understanding the details of health insurance, you could be wasting a ton of money— healthcare is the second largest expense behind payroll for most companies. So, in the spirit of clarity and transparency, here is Sherpaa’s Ultimate Health Insurance Lingo Dictionary.
Looking at a typical health insurance information booklet or a claim or an explanation of benefits can be incredibly confusing. There are so many terms and acronyms to try to decipher that it can sometimes seem like you are learning a new language. But fear not. We are here to help you understand some of the most important terms you are bound to come across:
Allowable Amount: Also called a UCR (usual, customary, and reasonable), this is the
dollar amount your health plan considers appropriate for a service provided in your area. In network doctors agree to charge no more than the allowable amount. If you go to an out of network doctor, you will have to pay any fee above the allowable amount
COBRA (Consolidated Omnibus Budget Reconciliation Act): A federal act that requires group health plans to allow employees to continue their group coverage for a stated period of time (18 months) once they leave a company. The employee has 60 days post departure to decide whether to take COBRA coverage.
Co-Insurance: The percentage you must pay of any additional bill after you have met your deductible. For zero, or in some cases low deductible plans, this kicks in immediately.
Co-pay: A fixed dollar amount that you are required to pay for a covered service in order to receive care. Typically, you will see co-pays for primary care physicians, for specialists, for prescriptions, and for hospitalizations.
Deductible: A fixed amount of the eligible expenses you are required to pay before reimbursement by your carrier begins.
EOB (Explanation of Benefits): The form sent to your home or office after a claim has been processed by your insurance carrier. The EOB details the amount the service cost, the amount paid out by the insurance carrier, the benefit available, and (when applicable) the reasons for denial of payment. It is very important to compare your EOB with your claim to ensure that there are no errors.
FSA (Flexible Spending Account): Allows employees to pay for medical expenses on a tax free basis. This is a “use it or lose it” plan, meaning that whatever funds you have contributed to the account will be lost if they are not spent at the end of the year. You also cannot take the account with you when you leave your company.
Health Care Claim: This is a fancy term for your bill. Along with the claim is a claim form which is initially filled out by your health care provider and then submitted to your insurance company for consideration of payment of benefits under your specific plan.
HMO (Health Maintenance Organization): A health plan that consists of a network of contracted doctors and hospitals to provide treatment for HMO members. HMO plans require PCPs to coordinate all health care. This plan type is the most restrictive in terms of options for care.
HRA (Health Reimbursement Arrangement): An account open and funded by an employer which gives employees tax breaks and reimburses them for health care expenses. Unlike an FSA, the balance on an HRA can carry over year to year.
Network: The doctors, hospitals and other providers that a health carrier has contracted with to deliver health care services to their members.
In Network: Covered services provided or ordered by your Primary Care Physician or other network provider
Out of Network: Services not provided, ordered or covered by your Primary Care Physician or other network provider
Out of Pocket: This refers to the maximum amount, per plan year, that you are required to pay out of your own wallet for covered health care services.
PPO (Preferred Provider Organization): A type of plan that is more flexible than an HMO, but still operates with a list of physicians/hospitals that are in network. With a PPO, you are able to see out of network providers, but they are only partially covered.
POS (Point Of Service): A plan that is, essentially, a combination of an HMO and PPO plan. You are required to have an in network PCP. You are able to see out of network providers, but will have to pay the cost unless your PCP refers you.
PCP: This is an acronym for Primary Care Physician
Preauthorization: The process by which a member or their Primary Care Physician notifies the health plan carrier, in advance, of plans for the member to undergo a course of care. This can include a complex test or a hospital admission, as two examples.
Premium: The monthly fee for your insurance coverage. The total monthly fee is often split between employers and employees. Premiums are often deducted from your paycheck on a pre-tax basis.