Saturday, June 14, 2008

Interesting Insurance Info


So, I thought this is the way insurance worked: You pay your premium, along with a big bunch of people. From that money, the insurance company pays out the benefits. I figured one month they might come out ahead, another they might not. At any rate, I thought that is how it worked.

IMAGINE MY SURPRISE when I found out today that Greg's company is a "self-pay" company. That means they pay admin fees only to the insurance company, and then when I incur an expense, Greg's company actually pays that expense. OK? See where I was going wrong? I thought Anthem paid it out of the money they got in premiums. But, no. The company itself pays for all of those expenses.

Somehow that made a big difference to me. Since I thought it was Anthem making the decisions on whether or not to pay, I was tapping into that societal consciousness that sees insurance companies as the bad guy. Not that there aren't some problems with health insurance in our country, but I finally got some clarification today on why and how "normal and customary" payments are determined.

And since I think Greg works for a REALLY great company, I am even more willing to incur the additional expense I am having to incur. We have great insurance coverage and I appreciate the company's decision to take such good care of their employees.

Just thought you should know.

5 comments:

Anonymous said...

I don't get it -- why does GT's fine company even need an insurance company if they're going to pay the expenses? Confused, mjm

SiouxsieQ said...

I think administering the insurance benefits is a HUGE job for so many people and the insurance company takes care of all the details of paying, paperwork, etc., which must just be mammoth. Then once a month the company pays the bill. Seems like a huge difference to me -- once a month write a check, or 5000 times a month deal with so-and-so's Rx, so-and-so's doctor visit, keep track of what is charged and what is allowed, etc.

Greg said...

You are so right, Siouxsie:

1. The admin $ required to run such a program this many people are more than what the company would want to pay to have employees do it full time.

2. By self-pay, company forces itself to look at other ways of providing needed health care + communicate to employees about healthy lifestyle -- and those employees have a stake in the result.

3. Said company establishes in-house medical services to directly control waste, vs. incur an annual fixed cost increasing at +12% per year.

4. Finally, allows the company to decide for itself what should be paid for vs. letting an insurance company decide. Company doesn't see insurance as a money-making venture, insurance company does. Therefore, for example, I even heard that the company paid over 99% of intensive care bill for newborn child amounting to over $43,000. Amazing.

What a smart person you are!

Stephanie M said...

Sounds like a foreign company to me. A smart foreign company. Just my thoughts.

SiouxsieQ said...

You are SO perceptive! Wow!