Understanding Health Insurance Coverage Gaps

Affordable Care Act

Understanding Health Insurance Coverage Gaps

Published on July 27, 2015


You may think that because you have Obamacare-compliant health insurance that all of your health-related expenses will be covered. However, you most likely have a number of coverage gaps, and you do not want to be blindsided by a large bill for a service you thought was covered.

Understand Meeting Your Deductible

Most health insurance plans have a set deductible that must be paid out-of-pocket by the insured before the insurance company begins paying for services. For example, while you may have a health insurance policy, the deductible may be a few thousand dollars or more, meaning that you will need to pay for certain appointments and procedures before the insurance actually kicks in and begins paying your bills. Preventive care, you’ll be glad to know, is often covered regardless of whether you’ve met your deductible for the year.
The eHealth Price Index report indicates that the average deductible for individuals during the most recent enrollment period was $4,120 annually, while families face an average $7,760 deductible.
These deductible amounts are not going to go down any time soon. In fact, eHealth Cost & Benefits and Price Index reports over the years have shown a consistent increase in the average deductible for individual coverage. Here are the figures eHealth has reported for the past five years:
• 2011 — $2,935
• 2012 — $3,079
• 2013 — $3,319
• 2014 — $4,164
• 2015 — $4,120
When picking a health insurance plan, too many consumers ignore annual deductibles and look only at monthly premiums. In order to get a proper understanding of the real cost of any plan, however, you need to look at the deductible too. Keep in mind that plans with higher monthly premiums come with lower annual deductibles, and vice versa.

Other Types of Coverage Gaps

In addition to deductibles, there are several other types of overlooked coverage gaps facing many insurance policy holders:
Copayments – Many insurance plans require policy holders to render a copayment at each non-preventive doctor visit; these generally do not count toward the deductible.
• Non-formulary prescription drugs – Many insurance and prescription drug plans have a formulary list of preferred drugs that are covered. Drugs not listed on your plans’ formulary may not be covered or may require a special pre-authorization before coverage is available.
Out-of-network providers – Insurance plans also typically have a specific network of covered physicians and medical. Services provided by in-network groups are usually covered by the insurance plan, though they may still be subject to the deductible. Out-of-network providers may not be covered at all.
• Experimental procedures or treatments – Experimental procedures or treatments which are not well established in the medical field may not be covered by your health insurance plan.
• Cosmetic or medically unnecessary care – Procedures or treatments considered purely cosmetic or not medically necessary, such as plastic surgeries or some diagnostic tests, may be denied by insurance companies.
• Lost income – While undergoing hospitalization or rehabilitation, a  policy holder may be out of work and losing income. This is not covered as part of a health insurance policy.

Ways to Close Coverage Gaps

Many health insurance policy holders face these coverage gaps at some point in their medical care, and they can be difficult financially and emotionally. Accident Insurance or Critical Illness Insurance can be used to help bridge these gaps and provide additional protections, but neither of these productgs should ever take the place of standard health insurance.
1. Accident Insurance – If a policy holder experiences a qualifying injury, an Accident Insurance may provide the policy holder with a lump-sum or an itemized payout based on the nature of the injury and the medical treatment received. Accident insurance plans typically cost around $15-50 per month. When a qualifying event occurs, money is paid directly to the policy holder rather than to the doctor or medical facility, helping to cover medical costs or lost income.
2. Critical Illness Insurance – Slightly more expensive, these products typically cost between $50-150 per month, and benefits are also paid directly to the policyholder. Payments are given for the diagnosis of qualifying medical conditions, such as heart attacks, stroke and some cancers.
To better understand accident  and critical illness insurance, read eHealth’s 2015 eBook on Accident and Critical Illness Insurance.
If you are concerned about potential gaps in your healthcare coverage, consider the many options that eHealth has to offer to keep you and your family protected from whatever life throws your way.

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