Protect Your Future With Expert Life and Health Insurance

There are two main types of health insurance: Fee-for-Service and Managed Care. While they differ, both types cover medical, surgical, and hospital expenses, and most include prescription drug coverage. Some even offer dental coverage.

Fee-for-Service

These plans usually pay a fee for each service a doctor provides. Patients can see any doctor they choose, and either the medical provider or the patient files the claim.

Managed Care

More than half of Americans use managed-care plans. These plans can include Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPOs), and Point-of-Service (POS) plans. Managed care plans offer broad health services and encourage patients to use specific providers within the plan to save money.

Due to aging, illness, or injury, some people need help with everyday activities such as eating, bathing, dressing, toileting, and moving around (like getting out of a chair or bed). These activities are called Activities of Daily Living (ADLs). If you struggle with two or more of these tasks or have a cognitive impairment, you might need what’s known as “long-term care.”

The term “long-term care” can be misleading because it doesn’t always last long. Some people only need help with ADLs for a few months or even less.

While many think long-term care means going to a nursing home, it can also be provided at an adult day care center, an assisted living facility, or even at home.

Assistance with ADLs is known as “custodial care,” which can sometimes be confused with “skilled care.” Skilled care includes medical, nursing, or rehabilitative services like medication help or testing (e.g., blood pressure checks). It’s important to know that Medicare and most private health insurance plans generally cover only skilled care, not custodial care.

There are two types of disability policies: Short-Term Disability (STD) and Long-Term Disability (LTD):

Short-Term Disability policies (STD) have a waiting period of 0 to 14 days with a maximum benefit period of no longer than two years.

Long-Term Disability policies (LTD) have a waiting period of several weeks to several months with a maximum benefit period ranging from a few years to the rest of your life.

Disability policies have two different protection features that are important to understand.

Non-cancelable means the policy cannot be canceled by the insurance company, except for nonpayment of premiums. This gives you the right to renew the policy every year without an increase in the premium or a reduction in benefits.

Guaranteed renewable gives you the right to renew the policy with the same benefits and not have the policy canceled by the company. However, your insurer has the right to increase your premiums as long as it does so for all other policyholders in the same rating class as you.

In addition to the traditional disability policies, there are several options you should consider when purchasing a policy:

Additional purchase options

Your insurance company gives you the right to buy additional insurance at a later time for an additional cost.

Coordination of benefits

The amount of benefits you receive from your insurance company is dependent on other benefits you receive because of your disability. Your policy specifies a target amount you will receive from all the policies combined, so this policy will make up the difference not paid by other policies.

Cost of living adjustment (COLA)

The COLA increases your disability benefits over time based on the increased cost of living measured by the Consumer Price Index. You will pay a higher premium if you select the COLA.

Residual or partial disability rider

This provision allows you to return to work part-time, collect part of your salary and receive a partial disability payment if you are still partially disabled.

Return of premium

This provision requires the insurance company to refund part of your premium if no claims are made for a specific period of time declared in the policy.

Waiver of premium provision

This clause means that you do not have to pay premiums on the policy after you’re disabled for 90 days.