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Health Benefit Indemnity
How it works
Health Benefit Indemnity insurance (HBI) is a health insurance plan that offers financial protection for commonly needed medical services, including hospital and doctor benefits. When you experience a covered medical event, HBI pays a predetermined amount of money, directly to you or a provider designated by you.
Supplemental medical insurance
HBI also can include supplemental medical insurance to provide added protection from critical illnesses or accidents, as well as supplemental non-insurance services such as telemedicine, insurance advocacy, and pharmacy. Gives a member a cash payment upon a qualifying incident (e.g. accident or critical illness). Some plans include additional wellness benefits such as telemedicine so members have access to doctor consultations via phone or online video chat 24/7 at no additional cost. Prescription discounts often included.
First collar coverage
Unlike traditional insurance, where you are responsible for paying co-pays and coinsurance, HBI offers "first dollar coverage", which provides you more flexibility for managing health care expenses. With HBI insurance when you experience a covered medical event requiring doctor or hospital services, the insurance company makes a fixed cash payment to you or a designated provider. You decide how to spend or save the benefit. With major medical health insurance, the insurance company pays a percentage of your medical bills directly to the provider after you cover your deductible. Major medical has higher dollar protection but often requires you to pay thousands of dollars out of pocket before the plan pays anything.
UCR (usual customary and reasonable)
UCR rates are the amounts that medical service providers in your area usually charge for services because indemnity plans are self-managed health insurance plans there is no network specifying the rates that your chosen providers will charge. As a result, you will want to familiarize yourself with the costs that your plan designates as UCR versus what your chosen provider will charge for services to avoid unexpected costs. In general most providers meet the criteria, however it is important to be informed when you use a self-managed plan like an indemnity health insurance plan.
Deductibles and co-payments
The deductible is the amount you are required to pay before policy benefits are provided. After the deductible, you may be required to pay a co-payment. A co-payment is a percentage you pay of the remaining charges after your deductible. For example: If your eligible charges are $800 and you have a $200 deductible, then that leaves $600 left. Say your co-payment is 20%. That means you are still required to pay 20% of the remaining amount of $600, which would be $120. Find out the deductible and co-insurance requirements of an indemnity health insurance plan to be sure you are able to cover the costs. Some indemnity health policies also provide a maximum amount that you will have to pay as co-insurance. These policies give you an advantage because once you hit the maximum payable, you no longer have to pay the co-insurance. Depending on your medical situation this can help manage the maximum costs you would pay as part of the policy.
No restricted network
You don’t have to stay in a particular network of doctors or providers. You are paid a fixed amount for certain services, so where you get those services is up to you. You have the freedom to choose your doctor, specialist, or hospital with few, if any limitations. In some cases, they may limit your options for a doctor, specialist, or hospital by geographic restriction, or area in which the provider is located. This gives a significant advantage to the freedom offered by an indemnity plan for many people.
In addition, fixed-indemnity plans may only cover a limited set of illnesses, injuries, drugs, and/or medical procedures, and sometimes do not cover hospital costs at all, so check your policy brochure carefully before you select a plan. Benefits are tied to particular incidents, such as a hospital admission or doctor visit. General illnesses like diabetes or conditions such as pregnancy don’t have benefits.
Fixed-indemnity insurance plans are not always guaranteed issue, so you may still have to go through the medical underwriting process when you purchase such a plan.
No referral necessary
A key feature of the indemnity health insurance plan is that it does not force you to choose a primary care doctor. Indemnity health insurance plans are also unique because they allow you to self-refer to specialists, they do not require you to obtain a referral in order to get compensated.
Freedom and flexibility
An Indemnity health insurance plan is a healthcare plan that allows you to choose the doctor, healthcare professional, hospital or service provider of your choice and gives you the greatest amount of flexibility and freedom in a health insurance plan.
Capped medical expense coverage at a rate much lower than major medical plans. Because the benefit is preset and paid out regardless of what the total bill for the qualified service might be, fixed indemnity insurance is sometimes called fixed benefit insurance or fee for service insurance.
You can enroll anytime
Applications for insurance are not limited to the Open Enrollment Period and can be made any time during the year. You don’t have to wait for open enrollment or qualify for a special enrollment period. You can shop and enroll year-round.
If you have pre-existing conditions, they most likely won’t be covered within the first twelve (12) months of coverage.
Preventative healthcare services
Some indemnity health insurance plans may not cover preventative services, while others do. Preventative health care services include yearly check-up exams and other routine office visits that are designed to prevent illnesses. Before selecting a health plan, be sure and discuss how preventative services are insured, and how much compensation you can expect. This will help you make the choice for the best possible plan. In some cases, costs of these services may not count towards your deductible.