When you are in the market to purchase a health insurance policy here in Arizona, you’ll find that you have approximately seven different health insurance companies offering plans. Each company offers several different plans with multiple deductible options. Blue Cross Blue Shield of Arizona alone offers six different plans to families and individuals, and if you add up all of their different deductible options, you’ll find that there are a total of 44 options from you to choose from.
Perhaps you narrow down your choices, and you decide to apply for a PPO plan, with a deductible of $1,000, but with doctor office visit co-pays of just $25. You get a copy of the Blue Cross application, sit down with your pen and start to fill out that long application. You’ll find that filling out the first part of the application will be easy — they’ll ask your name and address, your date of birth, your height and weight.
Sooner or later, you’ll come to the part where the important questions are asked — the health questions that the insurer needs to know in order to decide whether or not they actually want to offer a policy to you. Technically, the insurer wants to know EVERYTHING about your health history. They’ll ask about head and brain problems, lung problems, back problems, skin conditions, mental problems, bone problems, and anything and everything else you could think of. They ask these questions so that their underwriting department can make a financial decision to decline you or offer you a policy. Typically, if the insurer thinks you will be spending a lot of their money, they will not give you one of their policies. Some health insurance companies, if they think you will spend SOME of their money but not TOO much, might offer you a policy but charge you more for the monthly premium than they originally quoted you.
So, you’re now trying to answer the health questions and you come to a question that asks, “In the past ten years, have you had any lung problems?” You recall that, about six years ago, you had a bad cough that simply wouldn’t go away, so after two weeks of coughing, your wife made you go see the doctor. The doctor ended up doing a chest x-ray and took some blood. The doctor called you a couple of days later and told you you had bronchitis. Your doctor wrote you a prescription for an over-the-counter inhaler and told you to take Tylenol. The symptoms went away within a few days and never returned. You think to yourself, “I don’t think I need to mention the bronchitis. I only had it that one time, it never came back, and heck, I completely forgot all about it until I started filling out this application!” So you answer “no” to that question on the application. You complete the rest of the application and mail it to the insurance company and wait to see if they approve you. A week or so goes by and you receive a letter with your new ID card welcoming you as a new policyholder.
A year goes past, and one day you start to cough. A week goes by, the cough just won’t go away, and this time you feel sick, too. Once again your wife makes you see the doctor. The doctor runs some tests again, and tells you you have pneumonia. He wants to put you in the hospital for a day or two, and you end up staying there three days.
Your hospital bill comes to $47,211, and with all of the medical personnel that come in and out of your hospital room over those three days, you end up getting bills from various doctors that come to a grand total of another $6,200. Your total bill for this medical issue comes to over $50,000, but you know you have a health insurance policy with the best and biggest insurance company in the state. But unknown to you, your insurance company has asked your primary care doctor if it’s possible that you had pneumonia in the past. Your doctor sends your entire medical file off to the insurance company, and they see that you had a lung problem some seven years ago that you did not mention on your health insurance application. Your insurance company writes you a letter, informing you that they will not pay for the pneumonia expenses. They claim that, had they known about your bronchitis, they would have placed a rider on that condition from day one of your policy, meaning that you would not have any insurance coverage for bronchitis, pneumonia, or other lung issues. Their letter goes on to say “sign the enclosed rider form eliminating lung problems from your coverage, and we will make it a part of your policy. If you don’t sign it, we will rescind your policy, in effect cancelling it as though it never existed.”
You didn’t actually LIE on your application, you just thought the bronchitis was not a big deal, so you didn’t bother to mention it when you submitted your application. As it turns out, it IS a big deal, because now you owe over $50,000 to various medical providers. How will you pay for that? Most of those providers will probably take monthly payments from you. If you pay them in cash, some may reduce the amount you owe them a little.
If you had used the services of a professional health insurance agent, your agent would have advised you how important it is to mention everything medical that is in your past, and to not make assumptions for any insurance company. It is always better to tell an insurance company about a medical issue, and then let THEM decide what action to take. If, when you submitted the application to the insurance company, you had told them about the bronchitis that occurred six years earlier and never returned, most likely they would not have placed a rider on that condition, and it would have been covered if it returned. But because you failed to disclose that fact, the insurance company was acting within their rights and refused to pay your claims.
A professional health insurance agent will ask you many questions during the application process, and that agent will know what needs to be included on your application so that you do not find yourself in for expensive and unpleasant surprises if you end up with large medical bills. The monthly premium you will pay to an insurance company does not go up when you use the services of a licensed agent. If the Cigna premium is $135 per month for your premium, that will be your premium whether you buy the plan directly from Cigna or you purchase the plan through an agent.
There is an old saying that says a man who acts as his own lawyer has a fool for a client. The same can be said about buying health insurance on your own. A professional health insurance agent will always know more than you when it comes to dealing with an insurance company. And their service is free! Take advantage of that knowledge.
