Lessons of Insurance.

Insurance can be a rather dull topic to discuss. Frankly, so is health care. While I believe that we that live in the US have arguably some of the best health care in the world, it isn’t cheap and usually isn’t available to just anyone. That is, health are is available, but like most things in life the the breadth and depth of the quality you receive is rather diverse.

But today I’m talking about insurance. I know our nearest neighbors in Canada fancy their “social” healthcare system as well as our distant friends over the pond. When our president is tooting the need for better immigration and border control, he is touting his latest faux-paux in Medicare prescription drug reform. Health care, insurance and the avian flu are hard hitting news topics these days, huh?

But for me it’s insurance. Prior to leaving the country I made changes to my health insurance policy. Let me offer a bit of background of my original policy. An individual seeking insurance doesn’t have a lot of options. And underwriting is more demanding, too. You see if you are part of a company or corporate plan, an insurance company by law cannot reject you or refuse to give you a policy. But an individual must go through strict underwriting procedure which will affect the type of policy and the cost. Or in some cases, might result in rejection.

In my last company I was spoiled. I had great insurance coverage. But after running the course of COBRA (a law that requires insurance companies to offer insurance to individuals who quit, resign, laid off or are fired), I was forced to seek out insurance. I decided on a low deductible PPO from Blue Cross of California. Over the course of four years my premium increased nearly 30%. But that’s the insurance and health care business.

The beauty of a PPO plan is the simple freedom to choose your own doctor, hospital or other health care professional. The insurance company pays claims more favorably for “preferred providers” but if your provider is not on that list, you still are free to choose anyone. As with most policies, the security in owning a health insurance policy is knowing that you can visit a doctor or hospital at anytime.

Once I crossed the border into Mexico, the security and benefit of my insurance reduced dramatically. You see, Blue Cross has barely any preferred providers outside the country, and most doctors in foreign countries will not accept Blue Cross ( or any other domestic insurance plan) nor will Blue Cross pay for claims outside the US. Fortunately, health care in Latin America is rather inexpensive. Yet here I was faced with a decision to reduce the coverage of my policy because I would no longer be able to take advantage of doctor visits.

So I reduced my coverage to an emergency plan. That is, a policy that would cover hospital coverage and emergency treatments only. I also chose a higher deductible. My rationale was simple. If were to sustain significant injury or fall to ill health on my journey, I would take advantage of my MedJetAssist Emergency Evacuation Plan (not insurance, but a guarantee that I’d be evacuated out of any are to a hospital of my choice anywhere in the world in the event of an emergency) and if necessary return to the United States where my new Blue Cross Insurance plan would cover my hospital coverage. And while there are traveler health insurance policies, most of these are expensive and won’t cover health care costs domestically. With reasonable if not free coverage in most of the rest of the world, traveler insurance plans aren’t a good value.

I don’t know about you, but I don’t read every word of my insurance policies. Maybe I should. But I wrongfully assumed that my plan would cover all health care requirements related to my emergency. Nope. Only the hospital bills are covered. Even my post-surgery doctor visits are not covered. I am told that once I reach my out of pocket maximum of $5,000 these doctor visits will be covered.

But most irritating to me is my lack of Physical Therapy coverage. Even worse, as a Blue Cross “member”, the company negotiates contract rates with those preferred health care providers. I remember on my original policy that even though a doctor might have billed $150 for an office visit, Blue Cross would only pay $65; of which I would pay a small percentage of the negotiated rate as a co-pay. This goes for doctors, hospitals, labs and physical therapists. But for me, because physical therapy is not covered under my policy, Blue Cross won’t even honor nor negotiate for their preferred rates for physical therapy. I must pay full price. And must pay out of my pocket.

Even the girl in underwriting had assumed that 1) doctor visits related to an emergency covered by my plan would also be covered and negotiated to preferred Blue Cross rates; and 2) that I would be able to take advantage of my “membership” in Blue Cross and receive Blue Cross rates for my physical therapy. We both wrongfully assumed these things.

I thought maybe I’d just upgrade my policy back to my original plan. Problem is, Blue Cross requires a new application and requires me to go through the underwriting process as if I were a new applicant. Keep in mind that I’ve been with Blue Cross for over 5 years. According to the customer service rep at Blue Cross underwriting could reject my application based on a number of criteria — including health history.

So I spoke with underwriting. Sure enough, pre-existing conditions would not be covered. I asked if my broken leg, which was covered and treated under an existing and active Blue Cross policy, cold impact underwriting. She confirmed my fears. Yes it would impact coverage and be basis for denying or rejecting my application. What!? But. But. But. It’s already covered by Blue Cross. This doesn’t matter.

The only way to upgrade my policy will be to resubmit my applications at least six months after my last doctor’s appointment for the injury. Plus, I will have to prove that I received the physical therapy treatment that the doctor prescribed. Then they will consider my application. She did say that there is good news. As long as there were no complications with my leg and that I received my physical therapy, if I were to be accepted by Blue Cross for a new upgraded policy, if the leg were to bother me in the future it would be covered under the new plan.

I don’t want to get into the cost of my surgery, deductible and maximum out of pocket. But it sucks. Add the cost of physical therapy to the mix and I’m headed to the poor house.

The point of all this? Simply, know what you’re getting. It’s rather dull and boring — this business of insurance — but know what you’re getting.

No one ever thinks they’ll need their insurance, so most people are under insured.