1) Why does my doctor send a bill directly to me when my insurance company has already paid him?

It is common practice for doctors to bill patients directly even when they have been paid by an insurance carrier. This can occur for many reasons. The doctor may employ an outside billing service. Many offices simply make billing errors and do not fully reconcile their accounts properly. 

In all cases, you should call the claims department of the health insurance company. Give them the date of service with the doctor and the name of the doctor to confirm what you actually owe. In many cases the insurance company will take up the discrepancy directly with the doctor's office and you can get out of the middle. 

2) What is an "EOB" or explanation of benefits and why does my insurance company send them to me? Is an "EOB" a bill that I have to pay?

Health insurance companies send out an Explanation of Benfits (EOB's) every time you go to the doctor. EOB's are commonly confused with bills from the insurance company. They are not bills! The purpose of an EOB is simply to inform the patient how much the doctor was paid, discounts applied, and how much copay you paid at the time of the visit. The EOB often has a section that is called "Estimated Insured's Responsibility" which may become a bill from your provider at a later date. This amount generally refers to the deductible and coinsurance portion of your health plan. (If you are in an 80/60 PPO plan your portion of the bill will be 20% in network and 40% out of network.) The best bet is to call the Claims Department of the health insurance company to get a full explanation of the EOB. 

3) What is the difference between a PPO, a POS and an HMO?

A PPO is a Preferred Provider Organization. A POS is a Point of Service Plan and an HMO is a Health Maintenance Organization. All three organize their network of doctors a little differently. 

The PPO plan allows the most freedom of choice of physician. There is no requirement for a primary care physician. If you want to go to a specialist, you can go directly, without a referral. The out of pocket expenses associated with these plans are ususally higher than with an HMO.

An HMO is an organization of doctors from which the patient must choose a primary care physician for all care. If you need a specialist, you will have to get a referral from the primary care doctor first. If you choose to use a doctor out of the HMO network, it is the same as having no insurance. You will pay 100% of the bill right out of pocket.

Finally a Point of Service, POS, is hybrid of a PPO and an HMO. The POS is much more like an HMO, however. The major difference is that the POS also has an "out of network" group of doctors from which you can choose with reduced insurance coverage - usually 60% after a deductible.

4) Why do my health insurance rates keep going up when I have had no claims?

"Medical inflation" is affected by many factors including new medical technologies, soaring drug costs and an aging population.The drug card component of your health plan is increasing by 17% each year, just by itself.
However, one big factor that is rarely appreciated by the consumer is the high cost associated with government mandated benefits. For example, the government mandates that insurance companies cover pregnancy without pre-existing condition limitations. While this action is socially responsible, it does have a financial impact on the insurance companies that offer coverage and on all of us who pay premiums. 

Most experts agree that health insurance rate increases will be in the double digit range for 2001 and beyond. This rate increase does not even take into account any medical claim issues that may also adversely impact the rates of your group. Your best bet is to aggressively shop your group with a multitude of carriers to make sure you are getting the best deal possible.

5) Why do health insurers quote a low rate at first, only to raise the rates after you have enrolled in the plan?

All insurance companies request the most accurate medical information prior to giving out a quote. Confusion and mistakes frequently arise, however, because employers do not know confidential medical information about their employees. Lacking specific details about medical conditions, insurance companies rely on the enrollment process to discover or uncover medical conditions that may affect their rates. Unfortunately, the insurance providers can and will raise the rates after enrollment if the group size is not big enough to absorb the financial impact of several medical conditions. The perception is that a "bait and switch" has taken place with the rates and trusting relationships can get strained as a result.The best precaution is to get the most accurate information about the medical conditions in your group and to realize that the rates are volatile until you see a guaranteed rate in writing from the insurer. 

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