The healthcare industry—and healthcare coverage, in particular—is difficult to understand. Even seasoned agents and brokers can have a hard time figuring it all out as laws and regulations frequently change and new treatments come to market.
According to a recent UnitedHealthcare study, only 9 percent of Americans understand basic health insurance terms. Because choosing the right healthcare plan is critical to enjoying a high quality of life, this is a big problem.
The good news is that you can help your clients make smart healthcare decisions by educating them on the ins and outs of insurance and teaching them what they need to know.
In fact, healthcare clients are increasingly looking to brokers and agencies to be knowledgeable, trustworthy sources of information they can turn to for help. So not only can you help them figure out how to navigate the increasingly complex web of health insurance, but you can also meet their expectations by doing so.
With that in mind, let’s take a look at five things the average client doesn’t understand about their health insurance coverage.
1. How Costs Break Down
Premiums, deductibles, copayments, oh my!
Most U.S. adults have no idea what any of these terms mean—which makes it virtually impossible for them to pick a healthcare plan that works best for their specific situation.
There’s an easy fix: some simple definitions. Here they are:
- A premium refers to the amount of money you pay your insurance company each year. Premiums are deducted from the checks of employees who receive insurance through their jobs. People who pay for their own insurance out of pocket get a premium bill in the mail each month.
- A deductible is the amount an insured person needs to spend on top of premium payments before their insurance kicks in. If you have a $2,000 deductible, you need to pay $2,000 on top of your monthly premiums before your insurance kicks in.
- A copayment is the amount you pay for a covered service. For example, you might have a 20 percent copay on any doctor’s visit.
- Coinsurance refers to the percentage of costs your insurer absorbs once you’ve hit your deductible. For example, you might have to still pay 20 percent of a bill once you’ve met your deductible for certain services.
Creating a simple blog post that defines these terms can be particularly helpful for your clients and prospects.
2. What Out-of-Pocket Maximum Means
As the name suggests, your out-of-pocket maximum refers to how much money you can expect to spend on deductibles, copayments, and coinsurance. The moment you reach your out-of-pocket maximum, your insurer will cover 100 percent of the costs moving forward (minus your premiums).
A blog post can help here, too.
3. The Difference Between In-Network and Out-of-Network
When a doctor is in-network, your insurance plan covers services provided by them. When a doctor is out-of-network, it doesn’t.
Software for insurance agents can help your clients easily assess whether a provider is in-network before making a decision on which plan to go with.
4. Preventive Care That’s Included in Their Coverage
Most people have a hard time figuring out what preventive care is included in their coverage. For example, with the implementation of the Affordable Care Act, every insured individual is entitled to a free physical each year.
Be sure to clearly outline what preventive care services are available in each plan to help clients and prospects find healthcare coverage that works best for them.
5. Implications of Not Having Coverage—Particularly for Younger Folks
When you’re young, you feel like you’re invincible. At the same time, you don’t have enough real-world experience to know how prohibitively expensive medical issues can be.
None of us can predict the future. Even a 20-year-old might come down with a serious illness that costs tens of thousands of dollars to treat without insurance. There’s always the possibility of getting into a car accident, too.
Be sure to counsel younger clients about the implications of not having healthcare coverage in the event that something tragic happens to them.
Use Software for Insurance Agents to Help Your Clients Understand Their Health Insurance Coverage
One of the easiest ways for agents and brokers to help their clients understand health insurance coverage is by using software for insurance agents.
For example, real-time quoting software helps clients and prospects see apples-to-apples comparisons of different plans, the costs they can expect for each of them, which doctors are in-network, and what their out-of-pocket maximum would be.
Not only does this functionality deliver a better client experience, but it also helps meet expectations. For example, according to the above-referenced UnitedHealthcare survey, 44 percent of millennials like comparing healthcare plans online. Real-time quoting software gives them that ability while meeting their demands for convenience and instant gratification.
It’s not just for millennials, either. For example, older clients—like baby boomers—are getting increasingly comfortable online.
Simply put, the more educational resources and modern experiences you offer, the smarter and happier your clients will be—increasing the chances that they end up with health insurance coverage that works perfectly for them.