Health Insurance Considerations For Full-Timers

Isaac Creek Corps of Engineers Campground on the Alabama River, Franklin, AL , 09/05

Health Insurance For Full-Timers

I'll keep saying it. Health insurance can be THE determining factor in whether you are able to live the RV Dream. It must not be taken lightly, it may be the most complicated issue in preparing to full-time, and it must be researched thoroughly!

Here, we will explore some options, and we will try to provide resources where you can gather more information. What we will not do is pretend to be insurance experts.

Predictably, we know more about our own situation, so you may be in luck if your needs are similar to ours. But we will try to provide some information for all situations.

Our Subheadings will consist of Our Health Insurance, General Health Insurance Discussion, & Medicare Information.

Our Health Insurance

We are not old enough for Medicare (more on Medicare later- I have actually learned a little bit), and once we quit our jobs, we had no more corporate group insurance. We do not have any military or government benefits, either.

We could have continued our group insurance for a while, but COBRA is expensive. Before you continue, you may want to check out our COBRA Discussion.

Given our knowledge of COBRA, we understood that there was a very good chance that we could get pretty good rates on our own considering our age and good health.

Researching Health Insurance Online

My favorite health insurance website is eHealthInsurance. In fact, I like it so much that I won't allow any other health insurance advertising on this page even though we make nothing from people clicking through just to check it out. :)

Here is why. To get insurance quotes, all you need is a zip code, gender and birthdate of all to be insured, tobacco usage in the last 12 months, and whether the proposed insureds are full-time students.

There are no passwords or log-ins, no applications to fill out, and no email forms to complete, so you can get quotes from numerous plans quickly and without risk of email spams and solicitations.

The site gives you lots of plans to choose from, and you can click up to four plans for side by side comparisons of benefits. AND - here is a big plus - you can find out what plans and premiums are available for any zip code so you can plug in various potential home state zip codes to compare.

If there is an easier way to research (and buy) health insurance on the web, I haven't found it. (By the way, when you are on the Good Sam website and click on health insurance information, you get linked to eHealthInsurance, so it's not just me.)

So we went through eHealthInsurance and looked at plans with low premiums, high deductibles (for lower premiums), relatively low out-of-pocket maximums, 0% to 20% coinsurance (amount we pay out-of-pocket), and national providers so that we could stay "in-network" almost anywhere in the country.

CAUTION: Just because there is an affordable plan available for the zip code, it does not mean that the plan has hospitals and doctors across the country. Each plan assumes you will need services from hospitals and physicians in the zip code area you entered. For full-timing, you need to be sure that you can get services in all the areas you may be traveling in. Large insurance providers that you are familiar with often do not have national networks with providers in every state. Before making any decisions, make sure you can get covered, in-network services wherever you hope to travel.

From this research, we were able to determine that Anthem Blue Cross/Blue Shield Blue Access Plans (PPOs) were probably the best for us. The plan terms fit our needs and there are hospitals and doctors in the plans in every state.

You can apply for insurance directly through the eHealthInsurance website and bypass insurance agents.

However, we wanted the advice of a local insurance professional to make sure we were thinking correctly. So we called our life insurance guy with MetLife who we knew was an agent for health insurance companies as well. We discussed the plans we were looking at and he agreed with our assessment.

The one additional thing he recommended was a plan with a Health Savings Account (HSA) feature. For more information on HSAs, click on this Health Savings Account Link.

Once we did our research on HSAs, we agreed that we should make sure the plan we selected was a high deductible plan with an HSA feature. So we went back to eHealthInsurance and clicked on the HSA tab. Fortunately, the Anthem Blue Cross/Blue Shield Blue Access Plans did have HSA options. We selected Blue Access Plan 1 with a $4,800 family deductible, 20% out-of-pocket coinsurance, and a $6,050 out-of-pocket limit ($5 million lifetime maximum) with a starting annual premium of $2,365.80 (monthly premium of $197.15).

We again called our insurance guy. I handed him the printout of the plan we wanted, and he helped us with the application (we felt like we owed it to him to go that way rather than directly through the website). Our premiums were the same whether we used an agent or went through the website directly. Of course we understood that the premiums could be different based on lab work and underwriting of our health.

In anticipation of such lab work for health and life insurance purposes for our new life, we had adopted a healthier lifestyle and lost quite a bit of weight so we would test well and get the best ratings and premiums we could get. For some reason, we never had to undergo any lab work for the health insurance, and temporary insurance cards and a letter showing our $197.15 premium arrived within a couple of weeks.

UPDATE: Our second year premium starting August 1, 2006 was going to go up $331 to $2,697.00 for the year increasing our monthly payment to $224 - a 14% increase. Instead, we increased our deductible to $10,000 with $0 coinsurance (no out-of-pocket costs on our part once the deductible is met). That change decreased our annual premium to $2,025.36 or $168.78 monthly. We increased our HSA account by the maximum amount allowed to be contributed for deduction purposes for 2006. We will transfer additional funds in 2007 to make sure we have at least our $10,000 invested in the HSA to cover any emergency deductible.

General Health Insurance Discussion

Again, we are not experts on insurance, and we are rather healthy, so we have not experienced much in the way of dealing with insurance companies. We understand that many full-timers have specific insurance and prescription needs, and we are not qualified to address anything in the way of specifics.

With that said, we will attempt to provide some general tips on health insurance for full-timers. This discussion assumes that you have a basic understanding of health insurance and related terminology.

Workamper News Poll
Before we get started, here is a poll result for 2005 from Workamper News when their members were queried on health insurance (among several other items):

39% Conventional Health Insurance (Includes group insurance, individual insurance, HMOs, PPOs, etc.)

35% Medicare

20% Self-insured (No insurance)

6% Catastrophic coverage only

I just thought you might be interested in what the folks working on the road are doing about health insurance.

Now I was surprised to see that 20% Self-insured number. That tells me that there are a lot of people out there taking their chances, because if they were truly wealthy enough to self-insure, they should not need to Workamp. Maybe I am missing something from the poll, but please don't opt for "No insurance" unless you can REALLY cover all the potential costs yourself.

Premium Costs
Health Insurance costs can make or break the full-timing decision, so it is important to understand how full-timers can manage premium costs.

Assuming you know what type of coverage you need, and what type of plan you want, be sure to look at all options when pricing your insurance.

One myth is that group insurance is always less expensive than individual insurance. If you have health problems, that is probably true and you may want to stick with a group plan through a former employer or through some type of association.

However, if you are in good health, an individual plan may be a cheaper option for you than a group plan because the group may be statistically a greater health risk than you personally. For example, our health insurance costs for our individual policy is now 1/3 of what it was under our employer's group plan (and what we would have had to pay under COBRA).

Another thing to be aware of is the fact that insurance coverages and premiums are based on where you live. So as full-timers, you may be able to reduce your insurance premiums by your selection of "Home Base." So, while much is made on RV sites and forums of choosing a "Home Base" state to reduce taxes, little is mentioned about potential insurance premium savings.

We found that our insurance savings as Kentucky residents offset the state income tax savings of other states. Now that includes all types of insurance, not just health, but the point is to review health insurance rates in every state you consider for a Home Base. Again, eHealthInsurance is a great source to do that easily by just changing zip codes in the quote screen.

Of course another way to keep premiums low is to increase deductibles, co-insurance, and out-of-pocket maximums. The more the insurance companies can expect you to pick up your relatively low dollar, high occurrence health expenses, the better rate they are willing to give you. But you must have sufficient emergency reserves to cover the higher deductibles, etc. or one event could chase you right off the road.

Geographical Coverage
We will not get into plan and benefits coverage since they are so dependent on personal needs. However, we will remind you to be sure to verify that your health plan will cover you in all areas of your travel.

Several plans pay differently depending on whether the medical expenses you incur are "in-network" or "out-of-network." You need to be sure your medical network has physicians and hospitals wherever you travel, and many, many large plans do not have networks in every state. Do your homework.

Medicare Information

The following is taken from Medicare: The Official U.S. Government Site.

Medicare is a Health Insurance Program for:

People 65 years of age and older and some people under 65 with certain disabilities

Medicare has two parts:

Part A (Hospital Insurance) - Most people do not have to pay for Part A

Part B (Medical Insurance) - Most people pay monthly for Part B

Part A (Hospital Insurance)
Helps pay for:
Care in hospitals as an inpatient, critical access hospitals (small facilities that give limited outpatient and inpatient services to people in rural areas), skilled nursing facilities, hospice care, and some home health care.

Cost:
Most people get Part A automatically when they turn age 65. They do not have to pay a monthly payment called a premium for Part A because they or a spouse paid Medicare taxes while they were working for at least 40 quarters (10 years). If you (or your spouse) did not pay Medicare taxes while you worked for 40 quarters and you are age 65 or older, you still may be able to buy Part A. The cost for those that paid into Medicare for 30 - 39 quarters (7 1/2 years up to 10 years) is $233.00 per month for 2008. The premium is $423.00 per month for those with less than 30 quarters of Medicare coverered employment.

Part B (Medical Insurance)
Helps pay for:
Doctors' services, outpatient hospital care, and some other medical services that Part A does not cover such as the services of physical and occupational therapists, and some home health care. Part B helps pay for these covered services and supplies when they are "medically necessary."

Cost:
You pay the Medicare Part B premium of $99.40 per month in 2008 (could be higher if your income is more than $82,000 for a single, $164,000 for a married couple). In some cases this amount may also be higher if you did not choose Part B when you first became eligible at age 65. The cost of Part B may go up 10% for each 12-month period that you could have had Part B but did not sign up for it, except in special cases. You will have to pay this extra 10% for the rest of your life.

Enrolling in Part B is your choice. You can sign up for Part B anytime during a 7-month period that begins 3 months before you turn 65.

Medicare Eligibility

Generally, you are eligible for Medicare if you or your spouse worked for at least 10 years in Medicare-covered employment and you are 65 years old and a citizen or permanent resident of the United States.

For more information on Medicare and Medicaid (a joint effort between the federal government and states to provide certain eligible persons with health coverage) click on the Centers for Medicare & Medicaid Services website. The Centers for Medicare & Medicaid Services (CMS) is a Federal agency within the U.S. Department of Health and Human Services that administers the Medicare program and facilitates Medicaid operations.

Health Insurance Considerations Summary

The bottom line regarding health insurance for full-timers is that you must do the work to become educated on plans, coverages, and costs.

Is it fun? NO

Is it easy? NO

Is it confusing? YES

Does it take lots of time? YES

Is it crucial to your full-timing life? DEFINITELY

Will we help if you run into roadblocks? YOU BETCHA!! EMAIL US!

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