Clyde McPhatter – It’s A Lover’s Question

If You Cannot Work Will You Still Get Paid?

Today I got invited to join two training seminars on Friday about Disability Income insurance.  Although I already feel comfortable talking about Disability Income insurance, I have learned that I can never know everything.

Over time laws and policies change.  It is highly unusual for me to sell in 2013 the same policies I sold in 1987.  Fortunately, the internet allows me to stay informed on changes in the insurance industry.

It is through these webinars and my other news sources that I am able to find material for my weekly educational email.  I use the weekly emails as a way to stay in touch with my clients.  I am under no delusion that people want to be bothered by their insurance agent over the phone on a regular basis.  However, neither do they want an insurance agent who sales them something and then is never to be found again.

When someone buys a product from The Insurance Barn they are automatically added to the weekly email list.  The understanding is that if they find the information in the weekly email interesting and useful, they are able to educate themselves.  If they do not find any interest in the information, they can just delete that email and go on with their business.

Whatever they elect to do, they will always know who to call when they have an insurance question.

The weekly emails for 2013 have anticipated the national Open Enrollment into the mandated Essential Benefit Plans.  Although the weekly emails are written with my clients in mind, if you would like to get them each week, click on the banner below.

Until the Department of Health and Human Services releases details about the new health exchanges in late August,  the news about the national Open Enrollment is primarily speculation.

However, as details about the new exchanges come out, I will be using the weekly newsletter to keep people informed on what they must do, when they must do it and how they can go about fulfilling their part of the PPACA’s Individual Mandate.

In this post, however, I want to answer the question, “If I get hurt and cannot work, will I still get paid?”

That question has been asked since the early part of the 20th century.  A couple of decades before “Health Insurance” as we know it today, labor unions developed a system of paying a worker’s bills while he was laid up and could not earn a paycheck.  The idea was that neither a worker, nor his family, had to settle for a worse life-style simply because he was in the wrong place at the wrong time and got hurt.

Today, not much has changed.  People still ask, “If I get injured so that I cannot work, will I still get paid?”  The answer to that question is different for many people.

BUSINESS OWNERS

If you own and operate a business that employs others to do the work, it is likely that your salary will continue if you are injured or become ill and are unable to go into the office.

However, the business must continue even if you are not able to go into the office.  A Business Overhead Disability policy would provide enough money to keep the office open and meet payroll until you are able to return to work.

If you have skills that are required for your business or have no employees, it is likely that your income will stop if you get injured or become ill.  If that is the case, you are the Key Person in your business.  You should consider a Key Person Disability Income policy to replace your income while you recoup.

EMPLOYEES 

Many employers, especially, large companies, provide Disability Income to their employees as part of their benefit package.  If they suffer a non-work related accident or illness that prevents them from working for an extended period of time, they will still get, at least, a partial income.

Other employees are not as fortunate.  Many people work for companies that do not offer Disability Income insurance.  If that is true for you, I highly recommend that you stop reading this post right now and contact your insurance agent.

Unless you have enough money in your Rainy Day fund to allow you to pay your bills until Social Security Disability Insurance kicks in (6 months after a disability starts, at the earliest), you need some form of Disability Income insurance.

I realize that money is hard to earn.  There is a good chance that even more will be required of you under the coming Health Reform rules.

I understand that, however, I am still convinced that Disability Income insurance, for someone who lives from paycheck to paycheck, is just as important as the Major Medical insurance that the government is about to mandate for all Americans.

Yes, if you get sick or injured in the future, the doctors and hospitals need to be paid.  However, those are not the only bills you will be responsible for.  Your mortgage, car payment, utilities and groceries still have to be paid for.  Obamacare’s Essential Benefit Plans are there not to protect you but to protect the doctors and hospitals.  If you want insurance to protect you, you need to supplement your health insurance portfolio with Disability Income insurance.

Many people balk when they see how much Long Term Disability Insurance costs.  It is true that something that will secure your paycheck until you are 65 is quite expensive.

It is also true that you have at least two less expensive options.  You can get a comprehensive Disability Income insurance plan with a benefit period of less than 2 years, called a “Short Term Disability Income” insurance policy.  They are much less expensive and typically work very well in coordination with Social Security Disability Income.

Your other option would be a Disability Income plan that is more limited.  Accident Disability Income insurance only pays a benefit if you are injured while you are not at work.

Since Accident Disability Income insurance does not pay while you are out of work while you are recovering from an illness, like cancer, heart attack or stroke, I do not recommend this type of insurance unless it is all you can afford.

If you elect to trust Accident Disability Income insurance, I strongly urge you to also consider getting a Critical Illness insurance policy to create a Rainy Day fund if you do get ill from one of the Critical Diseases that are covered.

The Coasters – Get An Ugly Girl To Marry You

Are You Underinsured?

I have worked with insurance since 1987.  I know a bit about how to help people during rough times.

Over the past 4 years America has heard much about the problems of the “uninsured.”  Obamacare’s Essential Benefit Plans and Exchanges are supposed to do away with that problem.

However, I am afraid that the problem of the “under insured” in America has just started.

After reading and rereading the PPACA, from the viewpoint of an insurance agent and not a politician, I have come to the conclusion that the Patients Protection and Affordable Care Act promised more than it delivered.

I honestly do not care about who is in the White House.  Although I do not trust the present occupant, America chose to give him another 4 years last November.  That is enough for me.  (I may not agree with the choice America made but I understand that I live in a nation where the majority rules.)

Before I say what I am about to say, it might help you to know more about me.

• I am from Texas.  I am quite content with the two senators we have and the individual who represents my town in the House of Representatives.
• I do not belong to any political party.  Neither do I send money to any Political Action Committee so they can “Lobby” on behalf of me.  I find it hypocritical to complain about actions from one special interest group while I am sending money to another special interest group.

Maybe I am a bit jaded.  It is my belief that the politicians in D.C. are supposed to be looking out for my benefit.  Unfortunately, after several readings of “Obamacare” combined with 4 years of observation, I am convinced that the good of Americans was not the driving force behind the PPACA.

The PPACA was forced on Americans for political reasons.  The politicians were too anxious to secure their own re-election that they would not take the time to find a solution to the “Health Care Crisis.”

HOW WILL HEALTH PROFESSIONALS BENEFIT FROM OBAMACARE?

From an accounting standpoint, the PPACA solves the Accounts Receivable problems of doctors and hospitals.  Since all Americans are “mandated” to buy one of four government approved Essential Health Benefit Plans, health care providers know they are going to get paid whatever they ask.

Unfortunately, while the PPACA mandates new taxes and fees on insurance companies, that will be passed down to insureds in the form of higher premiums, it only encourages doctors and hospitals to limit their fees.  It does not mandate that they do anything about their charges.

Since the PPACA went into effect, many hospitals and doctors have raised their fees and charges.  Most states already have regulations for insurance companies that require them to collect enough money in premiums to pay for the medical bills for all of their customers.

When doctors and hospitals raise their rates, insurance companies must pay the bill that is presented to them.  Those bills are reflected in the premiums that you and I pay for health insurance.

Most states already had laws on the books, long before Barack Obama declared the “Health Care Crisis,” that require health insurance companies to collect enough money each year to pay for the medical bills they get for their insureds.

When doctors and hospitals raise their fees, our health insurance premiums must increase.

WHAT ABOUT THE UNDER INSURED?

All of the Essential Benefit Plans that are authorized in Obamacare require you to pay up to $6250 in either deductibles or co-insurance.  The major difference between the plans is in how fast you elect to meet that “maximum out-of-pocket” level.

If you have at least $6250 per person in your household in your Rainy Day fund you can skip over the point I make about Medically Necessary health care.

However, if you do not have sufficient money in your Rainy Day fund, you are under insured.

Medically Necessary

With Obamacare’s Essential Benefit Plans most, but not all, of your doctor, hospital and pharmacy bills will be paid for you.  However, if you do not have enough money in your Rainy Day fund to pay for the portion of the bill that is not paid, you will either need to make payment arrangements or buy a supplement to go along with your Essential Benefit Plan.

I expect insurance companies to develop new supplements to go along with the plans in Obamacare in the future but I wanted to list some of the supplemental policies that already exist that you might want to consider if you do not have enough money in you Rainy Day fund.

• Accident Supplements
• Dental Insurance
• Critical Illness Insurance
• Hospital Indemnity

Non-Medically Necessary

During the Health Care Reform debates of 2009, politicians in D.C. who were in favor of Obamacare wear eager to point out that the major reason for people to file for bankruptcy, even when they had health insurance, was medical bills.

(As an insurance agent, I know there is no standard definition of “Health Insurance.”  When someone says they have health insurance they could be referring to a piece of crap that only pays a benefit for named accidental injury of a comprehensive Major Medical plan.  Both people can say they had health insurance.)

Now that Obamacare is the law of the land, it is time to face an inconvenient truth.  Those people who had good Major Medical insurance but still had to file for bankruptcy did so not because their doctors and hospitals did not get paid.  Their Major Medical insurance company paid them something.

The problem is that, after paying their deductible and co-insurance, they were not able to pay their regular bills, like mortgage, utilities, groceries, etc.

None of Obamacare’s Essential Benefit Plans will pay those bills.  Unless you have enough money in your Rainy Day fund to last you while you recover from a serious illness or accident, you will need to supplement your Essential Benefit Plan with either a Critical Illness or Disability Income policy.

Many employers offer these types of policies either as a voluntary (you pay the premium) or involuntary (your employer pays the premium) benefit.  If you work for a company that does not offer a benefit like this, you can get them as a stand alone policy.