HealthSavings
News editor, Matthew Osborn, spoke with Paul Zane Pilzer, economist
and best selling author, on common myths surrounding health
insurance costs.
HealthSavings News: What are some common myths that
individuals face when considering health insurance options?
Pilzer: One of the most common myths is that individual plans
are twice the price of employer-sponsored plans. In fact, individual
plans for healthy families are typically half the price of
employer-sponsored plans. Most employers don’t want you to know this
because if your spouse is healthy the employer would not collect the
premium.
HealthSavings News: Can individuals negotiate with their
insurance company on individual plans?
Pilzer:
You just have to know how to do it. When people typically shop by
price they line up the options and make a selection based on cost.
The problem with insurance is that the stated cost only goes to
about 60% of the people who apply. The remaining 30% who are
accepted are uprated. Consumers should question the uprating,
especially if it was based on a condition from the past, such as an
accident that occurred in youth. To counter an uprating, you will
need to get a letter from the doctor stating why the past condition
won’t impact your current state of health.
HealthSavings News: You mention the COBRA loophole in your
book,
The New Health Insurance Solution. What is it?
Pilzer: COBRA is a guaranteed product, and you have 90 days
to accept it if you leave your employer. You should take the time to
shop for other alternatives. If you elect to take COBRA, you have up
to 105 days to pay the premium, and when you do your coverage is
retroactive to Day 1. So even if you have to go to the doctor, it
may be cheaper to pay for the visit out-of-pocket rather than elect
COBRA, since you can elect COBRA retroactively if you become
seriously ill.
Paul Zane Pilzer is a world-renowned economist, a
multimillionaire software entrepreneur, an adjunct professor, and
the author of seven best-selling books and dozens of scholarly
publications on economics.
