Claims vs. Coverage – Nothing is Free

Today’s Tuesday Tips:

  • Your premiums are calculated on two main things – your age & the number of claims you file
  • Not all preventative care is covered by your insurance, and oftentimes doctors think it is and will tell you it is.

I hear from a number of people that because their doctor’s appointments are fully covered by insurance, they don’t care what the cost is, as long as they don’t have to pay anything. In reality, this is actually a problem. Why? Because although you may think that you’re not paying for those services and that they are free, nothing is truly free. Remember, that your insurance premiums are based on the number of claims you make, (as well as on your age). So, it stands to reason that if you file a large number of claims, for large values, your insurance premium could increase next year.

It’s important to avoid excessive insurance claims. This is especially important to take note of if you are referred by your doctors to get unnecessary treatment or unnecessary, excessive preventive tests done. I am not saying that you should not have your preventive tests done. It is important. But there are also guidelines and logical thinking involved – risk factors, and age considerations to name a few.

However, there are some doctors whose mindset is “well if your insurance will cover it, let’s do this.” And this can be problematic.

This happened to a client of mine. She went to the doctor for her yearly female checkup, and the doctor said, “Oh, we need to run all these tests. Don’t worry, your insurance will pay for it. It’s preventive.” Well, guess what? Firstly, insurance didn’t pay for all of it. Secondly, doctors shouldn’t be telling patients that their insurance will pay because they do not actually know what their insurance plan actually pays. The doctor’s office, after telling her it would be covered, then proceeded to continue to send her a bill for $700 for tests that she in fact didn’t even need. It is also important to note, and I am not saying that this is the case with every doctor’s office, but many times, the reason that they are recommending all of these preventative tests is to increase their bottom line.

There is another side to this too. I’ve recently read an article where someone went and had a COVID test. The COVID test should be free, with no out-of-pocket cost to you at the time of the test. What happened to a person I am familiar with, is that the facility that did the test charged the insurance company $10,000 for this test. This person happened to work for the lab that had performed the test, and it sent up a red flag for them. This is because they know the cost of the materials, which is a few dollars for this type of test. Yes, there’s a charge for the labor for performing the test, but not $10,000. This person actually resigned from their position at the lab, because they didn’t want to be a part of scamming clients and insurance companies. Again, if this claim of $10,000 was logged on your insurance plan, it would affect your premiums for the next year.

The main takeaway from this is that it is super important to pay attention to what’s being billed to your insurance. If you wonder why your premium goes up, go back and look at your claims. Go back and look at what they’ve billed your insurance for as you may find out they’re overcharging. And you’re going to end up footing the bill for that in the form of raised premiums.

I always tell people, that nothing is free. Never, never, never free. The cost of anything you have done is figured into your premium.

As consumers, we can certainly help try to mitigate our insurance premiums increasing so much by having conversations with your doctor to determine what tests and procedures you truly do need.

If you would like to have a conversation around this subject, and any other when it comes to health care please feel free to contact me.

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