It may seem like common sense to purchase a health coverage online through a website. However, while we may seem like an “online nation”, there are many people, believe it or not, who do not have regular access to the Internet. Some individuals still make the call to an agent in order to obtain health insurance coverage. However, personal insurance purchases on the web are starting to become much more common according to a publication on Government Health IT entitled “Study: Consumers shift to online health plan enrollment.” In fact, many recent studies conducted by some of the top research and analysis firms are showing a major shift in this trend.
There are many websites available that offer health insurance quotes and online insurance enrollment. Many studies have been conducted in the last couple of years to see just how people are obtaining health coverage. To much surprise, the findings show a twenty-three percent increase in the amount of people purchasing health insurance online, without an agent, as opposed to over the phone through a health insurance professional. This is large increase, showing that, not only are people becoming more savvy about technology, but that they are more educated about their health plan options emaemj.org. It appears that either people do not have as many questions about health coverage or that websites have become more informative and are able to answer the questions that consumers have about health plans. If this trend continues, many health insurance agents may struggle to survive in the business. Especially considering that, because of the new “Obama-care” health care reform, many insurance carriers have lowered agent commissions. This has already lowered the number of active health insurance professionals.
Does this mean that health plans will become less expensive? Well, that remains to be seen. We must take into consideration that one of the changes that will happen because of health care reform is that insurance companies will no longer be able to decline coverage based on an individual’s health. This is good with respect to the fact that more people will be able to obtain health insurance, especially people who would normally be declined based on a pre-existing health condition (e.g. – Diabetes, Heart Attack, Cancer). However, this will cause more claims. Health insurance companies are in the business to make money. When there are more insurance claims then the insurance company has more cost per insured person, thus driving up insurance premiums. It seems that the US government has plans to help the tax-payer with the cost of health insurance through health care reform. But that remains to be seen as well
In case you don’t know, let me give you a little primer on insurance. Insurance premiums are based on, among other things, claims – both the number and the amount of the claims. The individual states Department of Insurance ride herd over insurance companies to see that the amount paid out in claims is in proportion to the amount collected in premiums. So an insurance company doesn’t get a rate increase unless they have the claims to substantiate the increase. (That, by the way, is the one good service that the departments of insurance serve, since as individuals we don’t have the time nor the inclination nor the resources to look all of that information up.)
So let’s now go back to the oil change scenario and look at it again. Instead of the one, two or three claims that you may file in a lifetime on your car insurance, you now find yourself filing a claim every three months or 10,000 miles. What would you expect your premiums to be like? How much would they increase? Also take this into consideration; your local mechanic or oil change service would have to wait 90 to 120 days to get paid for their money for the oil change. Plus there would be layer upon layer of paperwork to file the claim. The fact is, that if car insurance was like health insurance, your local oil jockey would have to hire an entire billing department just to file the correct forms with the correct codes – not once – but maybe as many three or four times.
Do you think the oil change would still be $35.00 at your local Spiffy Lube would still be $35.00 or with the added payers of paperwork and personnel would the cost go up?
The average face time with a medical doctor in the United States in now less than 10 minutes. The average amount of office labor involved in collecting the money for that 10 minute visit is upwards of three hours. How much is that costing you? Since there are no statistics kept on this let me do the simple math for you here. Billing and coding personnel make an average of $15.00 an hour. That could mean as much as $45.00 of your health care dollar goes toward processing your claim… and that is just at the doctor’s office. To be fair it is probably close to $30.00 on average but that is still a mighty large chunk of money.
It is even larger when you look at what the doctor gets paid. (I told you earlier we would get back to this.) Don’t look at what the doctor bills, Look instead at your EOB, Explanation of Benefits that comes in a few months down the road. Don’t get caught up in the coding and insurance gibberish but instead look good and hard at the amount that was paid to the doctor. In many cases it will be something around $50.00, up to very rarely, $100.00