As you review and consider your health insurance policy and renewal, it’s important to understand what you are getting into.

Health Insurance vs. Health Sharing Plans

While we’re all looking to save money, it’s important to understand the pros/cons of health insurance and health sharing plans, the latter of which are typically less expensive.

With health insurance, pre-existing conditions must be covered.  If you’re an employer, and looking to lower your insurance premium, note that HIPPA prevents you from knowing – or even asking about medical history. If you go with a health share or referenced based pricing  plan to get a lower premium and potential deductible, make sure you know if this covers pre-existing. If you have one employee who has a pre-existing condition and they  think they’re covered, you may be setting them up to be denied coverage and get hit with a large medical bill.

Health Insurance

Health insurance covers the big things, including preventive care.  You can also add a supplemental health plan to cover what insurance doesn’t cover. While there is a deductible, there is no maximum health care limit if something goes wrong.

For example, if you are in mountain bike or ski accident, you could end up with a traumatic brain or spinal injury, or in a coma, expenses that could exceed $1M.  The right health insurance policy will cover these expenses above and beyond your deductible.

Referenced Based Pricing  Plans

Offered by a health insurance company, these plans offer  Medicare rates plus an additional certain percentage.  However, there is no requirement by hospitals to accept this type of plan or insurance.  While some expenses will be covered, you or your employees may wind up with what is called balance billing to cover the total cost of medical services and care.

Health Sharing Plans

As the name implies, everyone who invests in these types of plans share the cost of any claim. If there are several big claims, the pot can get drained, and reimbursement goes down. There is no insurance provider backing or underwriter to cover costs that the fund can’t provide.

This is where working with an experienced broker – in your region – becomes paramount. The very regulations that can add to costs can also be the difference between getting or being denied coverage.

Tony Martinez is the founder and principal agent of Gypsum-based Cornerstone Insurance & Financial Group. With more than a decade of insurance experience in the Vail Valley, the team brings experience in all industries, offering businesses an inside track and understanding about insurance challenges, risks, and liabilities. The company also addresses how best to reduce risks with thorough business health checks for businesses large and small, locally, regionally, and nationally. Their background also includes 40 years’ experience in back of the house hospitality, including positions with Gramercy Tavern Culinary Group, Lodge at Vail, Arrabelle, and Beano’s Cabin to be the leading hospitality business insurer in the Eagle County.