New baby coming - Dual Insurance blunder and ideas...

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To start this thread, I've got a new kid on the way, due around April 1st (no, this is not april fools!!). I have a good job with a company I've been with a long time, they have great health coverage with a coupled HRA plan with infinite rollover and a nice balance. Wife and first kid are dependents on my plan. 80/20 split on most applicable charges for having a kid.

Last year my wife started a new job and they offer free health coverage for employee plus families; not knowing any better and not doing my due diligence I had her opt in to accept it. We are no where near open enrollment. 80/20 split on most applicable charges for having a kid. Due to birthdays, she comes before me and I believe her insurance is primary for the kids and her.

Fast forward to thinking about finances for the new baby I've realized I think I made a big mistake, her plan does not have a bundled HRA account with a balance and has a nice semi-high deductible at $3500 per person, $7000 per family.

My assumption is that I'm going to have to eat the deductible and 20% co-insurance portion of all charges on this. I expect the only action I could take would be:
a) She quits her job to get us out of their insurance with the hope of getting the job back after a standard 12 weeks or so.
b) We elect to drop her insurance as of the kids birthday; only changes charges as of that day forward, not before. I imagine delivery is the biggest charge and thats before...

Anything I'm missing? Options I should consider?

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HRA's can come in many forms. Mine can not be used for anything but claims to my insurance being paid out. It's just how... (more)

foglem (Feb. 21, 2017 @ 11:06p) |

An HRA is an HRA, it is an IRS Term. †There can be some different guidelines, but the concept is the same across all I'v... (more)

dobby10 (Feb. 22, 2017 @ 5:55a) |

Well, things are certainly not looking good. The HRA as I thought is tied to Anthem insurance and can't be used for any ... (more)

foglem (Feb. 22, 2017 @ 10:04p) |

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One thing you can try. Ask the insurance company that you have access to through work whether they would consider your wife dropping her company's plan a qualifying event.

If so, have her drop her plan and then you can enroll with your insurance company due to the qualifying event.

My DW and I did this - she was covered under her company's plan and we had non-overlapping open enrollment periods. She dropped her plan and I added her onto my plan. To be fair, this was during my open enrollment. They required proof that she lost coverage.

YMMV, but it's worth asking if you can do this.

My wife's company let her drop insurance with no qualifying event. Not sure why, we just asked and they said she could cancel anytime.

Used this to sign up for a $700 a month health plan in January, have a baby in February for a $200 Co pay, and then drop coverage the next day.

She's already on my plan; it simply does no good since both are 80/20 split insurances. Essntially without dropping hers there is no way to get to mine paying from the HRA balance.

I didn't think we can drop coverage outside open enrollment or a qualifying event (i.e. After the kid is born). However now that you posted that and a little research it might be an option! I need to dig into that, since we have her on mine already that would be great!

Maybe I'm dense but I don't understand what is going on. If she's under your insurance, why can't you use your insurance (and HRA)? Why do you have two health plans at once?

The primary insurance isn't going to matter to the ultimate outcome of the charges and what you are going to owe OOP. See this link with a great example:
http://www.4j.lane.edu/files/benefits/4J_BENE_Coordination_Examp...

Hope that helps.

Are you sure that you fully understand how the 2nd policy will cover your wife? It's my understanding that you can submit the claim to both policies (first the primary and then the secondary).

It's my understanding that the primary policy will get the claim first, and do what it does. Then the secondary policy will get the claim because the first only partially paid it.
Insure.com said: http://www.insure.com/health-insurance/primary-health-plans.html
You donít get to choose which health plan is primary, meaning the one that pays first. You donít get to choose which insurer will pay a certain claim. However, if the first insurer doesnít cover a certain treatment, or covers it only partially, you can then submit the remainder of the claim to your secondary insurer for payment, assuming the treatment is covered under the second plan.

In your case, her policy would make you pay the deductible and then pay out. Then the claim can be submitted to your policy -- which has a lower deductible. Since it has a lower deductible, it†should†then payout according to its own deductible -- which can actually be the same deductible applied again to this claim. See (unless there's something unique about Oregon, this should be how it works):

http://www.4j.lane.edu/files/benefits/4J_BENE_Coordination_Examp...

in general what's the positive of dual insurance? I thought they mostly cause problems like the OP has...

That's the problem, when they are both 80/20 or generally the same (with no cap) there is no benefit to have dual. In my case yes they have the same cost to me, the advantage is one has a HRA balance which is essentially free money (employer paid) where the other has only the after deductible benefits.

For those thinking you submit to one and then get the second to pay the out of pocket amount, it sadly doesn't work that way. That's the thinking that gets people like me into this mess! If the first pays 80% but has a co-insurance for 20% and a deductible of 3500 then you pay everything. The amount is 100% "decided" by the primary and thus secondary will deny everything. The advantage would be a secondary that pays for instance 85%... or more.

foglem said:   That's the problem, when they are both 80/20 or generally the same (with no cap) there is no benefit to have dual. In my case yes they have the same cost to me, the advantage is one has a HRA balance which is essentially free money (employer paid) where the other has only the after deductible benefits.

For those thinking you submit to one and then get the second to pay the out of pocket amount, it sadly doesn't work that way. That's the thinking that gets people like me into this mess! If the first pays 80% but has a co-insurance for 20% and a deductible of 3500 then you pay everything. The amount is 100% "decided" by the primary and thus secondary will deny everything. The advantage would be a secondary that pays for instance 85%... or more.

† That's not what the examples that I posted says at all.

I suppose I should mention the kicker is the secondary has a non-duplication clause. Thus the problem. Are there actually any that don't have that? FYI Cigna is primary and Anthem is secondary in this case.

http://benefits.advocatehealth.com/NonDupofbenefits.asp

The issue isn't 80/20 split or whatever you want to keep calling it. It is if you have a high deductible plan that qualifies for a an HSA/HRA, you can only have one insurance, if you have another insurance, then the plan won't pay out.

I have had dual insurance for about 5 years (non-consecutively) and it is great when you can use it. It is always a PITA, though. You have to get the coordination of benefits done properly and you have to make sure that all of your providers file claims properly. We had this happen once because I had a HDHP w/ HSA and my wife got a job and enrolled in coverage. I didn't reallize what would happen. However, that was the first time that we had dual coverage (well, in effect, single coverage).

Review your plan documents. I think you are looking at this 100% incorrectly....

You technically have 3 plans. Company A (Wife), Company B (You), Company C (HRA). (If company B and C are the same, that's fine, it is still a separate plan.)

Your wife will get covered under Company A. Company B will not pay anything. But Company C is your "Bank Account" to cover all qualified medical expenses, which includes Co-pays, deductibles etc. Company B won't be paying anything because of the 80/20 split, but they will be paying your deductibles/co-pay, from your "HRA bank account".

Do insurance companies check with each other to see if a person has multiple policies when processing a claim? It seems like you could just give them your insurance card for the policy you want to use and never mention the other one.

plastrd said:   Do insurance companies check with each other to see if a person has multiple policies when processing a claim? It seems like you could just give them your insurance card for the policy you want to use and never mention the other one.
† They do require you provide COB information (coordination of benefits) that is accurate. If you do as you say it's possible you'd get away with it for awhile. But if they find out you're in a world of hurt when all the charges reverse. Don't do this!
dobby10 said: Review your plan documents. I think you are looking at this 100% incorrectly....

You technically have 3 plans. Company A (Wife), Company B (You), Company C (HRA). (If company B and C are the same, that's fine, it is still a separate plan.)

Your wife will get covered under Company A. Company B will not pay anything. But Company C is your "Bank Account" to cover all qualified medical expenses, which includes Co-pays, deductibles etc. Company B won't be paying anything because of the 80/20 split, but they will be paying your deductibles/co-pay, from your "HRA bank account".


No, in my case as least the HRA is directly managed by the Company B in your example. If they don't pay, the HRA funds are unused.

So far the best advice I see here is to try and see if I can cancel the wifes insurance completely at anytime. Dus10, it sounds like you have a little experience with this mess, what do you mean by coordination of benfits done properly? As far as I know it's simply whatever method the insurance companies go by that you're stuck with. In my case mine uses a non duplication of benefits method which means if they would have paid out the same or less than the primary, they don't pay anything. Since my HRA is attached to them that means my "free money" can't be used and it comes out of pocket. FYI for those that don't know a HRA is like a HSA but the funds come from the employer instead of the employee.

plastrd said:   Do insurance companies check with each other to see if a person has multiple policies when processing a claim? It seems like you could just give them your insurance card for the policy you want to use and never mention the other one.
† Not to any level that is beneficial. †They check to determine if it isn't claimed properly and then give you a letter saying that they are throwing up thier hands and walking away without paying anything. †I have had to call and get them to talk to each other. †Once they do that, then you have to make sure that any provider that you use bills it appropriately. †You would think that since you are saving them money, they would be happier to do this and have a simple process for it. †I have been expecting dual coverage to become a more popular thing with all of the dual income households and the increases in insurance costs being mitigated by worse coverage to a large extent.

zonacat said:   My wife's company let her drop insurance with no qualifying event. Not sure why, we just asked and they said she could cancel anytime.

Used this to sign up for a $700 a month health plan in January, have a baby in February for a $200 Co pay, and then drop coverage the next day.

††
I can't decide if I should give you green for exploiting a poorly designed system or red for making health care more expensive for the rest of us.

About 17 months ago, my wife gave birth to our first child. She was primary covered on her insurance, and secondary on my insurance. When we registered at the hospital they took both insurance cards, information, etc. Did their paperwork (perhaps poorly?). During our labor class a month before delivery at the same hospital, they told us to bring cash for circumcision because the nurse that does that will not accept anything but, and insurance never pays it.

Day of delivery comes, child is born. Circumcised the following day (the nurse never asked for payment - although we did have cash and asked if we pay now or later, she said later). The following day we check out of the hospital (3 days, 2 nights total) and ask if there is anything we need to pay right now. They tell us nope, good to go.

17 months later the only bill we received was 80/20 payment for baby's audiology check, $17 or something like that. We somehow didn't pay even a penny for whatever care/procedure for my wife. And never anything but the $17 for the baby.

My guess is the hospital had no idea how to proceed with primary/secondary and ate whatever costs the insurance companies didn't willfully pay out. Including the supposed "cash only" procedure.

Congrats on the new baby! And good luck sorting this all out. Who know's, you might get lucky and benefit from your "blunder" during open enrollment.

foglem said:   
plastrd said:   Do insurance companies check with each other to see if a person has multiple policies when processing a claim? It seems like you could just give them your insurance card for the policy you want to use and never mention the other one.
† They do require you provide COB information (coordination of benefits) that is accurate. If you do as you say it's possible you'd get away with it for awhile. But if they find out you're in a world of hurt when all the charges reverse. Don't do this!
dobby10 said: Review your plan documents. I think you are looking at this 100% incorrectly....

You technically have 3 plans. Company A (Wife), Company B (You), Company C (HRA). (If company B and C are the same, that's fine, it is still a separate plan.)

Your wife will get covered under Company A. Company B will not pay anything. But Company C is your "Bank Account" to cover all qualified medical expenses, which includes Co-pays, deductibles etc. Company B won't be paying anything because of the 80/20 split, but they will be paying your deductibles/co-pay, from your "HRA bank account".

No, in my case as least the HRA is directly managed by the Company B in your example. If they don't pay, the HRA funds are unused.

So far the best advice I see here is to try and see if I can cancel the wifes insurance completely at anytime. Dus10, it sounds like you have a little experience with this mess, what do you mean by coordination of benfits done properly? As far as I know it's simply whatever method the insurance companies go by that you're stuck with. In my case mine uses a non duplication of benefits method which means if they would have paid out the same or less than the primary, they don't pay anything. Since my HRA is attached to them that means my "free money" can't be used and it comes out of pocket. FYI for those that don't know a HRA is like a HSA but the funds come from the employer instead of the employee.

† They are probably the third-party administrator for the money -- it's probably actually part of a separate†plan.

tante said:   
zonacat said:   My wife's company let her drop insurance with no qualifying event. Not sure why, we just asked and they said she could cancel anytime.

Used this to sign up for a $700 a month health plan in January, have a baby in February for a $200 Co pay, and then drop coverage the next day.

††I can't decide if I should give you green for exploiting a poorly designed system or red for making health care more expensive for the rest of us.

† Assuming the wife is covered by insurance continuously, it's not really making health care more expensive for everyone -- it just shifts who paid for it.

FWIW -- Having the bad IS a qualified event would allow a change in health plans for the entire family.

tante said:   zonacat said:   My wife's company let her drop insurance with no qualifying event. Not sure why, we just asked and they said she could cancel anytime.

Used this to sign up for a $700 a month health plan in January, have a baby in February for a $200 Co pay, and then drop coverage the next day.

††
I can't decide if I should give you green for exploiting a poorly designed system or red for making health care more expensive for the rest of us.


The employer and health company offered the benefits and made the rules, all I do is do all I can to be financially savvy within the confines of their broken system.

We had our first baby for a $250 copay 3 years earlier on 100% employer paid healthcare with no taking advantage of any system. So 3 years ago it all works out fine but now because of the government deciding how things need to work I'm supposed to go out of pocket $7K instead? Same employers, same hospital, same procedures, etc.

Sorry but I'm taking any advantage I can get when the rules are stacked against me.

stanolshefski said:   
tante said:   
zonacat said:   My wife's company let her drop insurance with no qualifying event. Not sure why, we just asked and they said she could cancel anytime.

Used this to sign up for a $700 a month health plan in January, have a baby in February for a $200 Co pay, and then drop coverage the next day.

††I can't decide if I should give you green for exploiting a poorly designed system or red for making health care more expensive for the rest of us.

† Assuming the wife is covered by insurance continuously, it's not really making health care more expensive for everyone -- it just shifts who paid for it.

FWIW -- Having the bad IS a qualified event would allow a change in health plans for the entire family.

††
Correct, but that qualifying event occurs AT delivery. Thus the babies needs can be decided upon after the delivery but everything leading up to and including delivery is before the qualifying event. I think at that point I'd just suck it up and leave it on her insurance since we will be nearing the max out of pocket for the year. The big question is if I can drop her plan now. That's what I have her checking with her HR group today. Thanks for the suggestion zonacat.

Slightly OT, but what about someone who doesn't have insurance and then has a baby. Can this person, who now has a qualifying event, get coverage back to the delivery or will she have to pay for the delivery out of pocket and then have coverage for everything afterwards? I tried googling, but I didn't come up with any reliable answers.

ETA: Similar situation: Someone has a HDHP and then has a baby. Can this person switch to a platinum plan after birth and have the birth covered?

TIA

stanolshefski said:   
foglem said:   
plastrd said:   Do insurance companies check with each other to see if a person has multiple policies when processing a claim? It seems like you could just give them your insurance card for the policy you want to use and never mention the other one.
† They do require you provide COB information (coordination of benefits) that is accurate. If you do as you say it's possible you'd get away with it for awhile. But if they find out you're in a world of hurt when all the charges reverse. Don't do this!
dobby10 said: Review your plan documents. I think you are looking at this 100% incorrectly....

You technically have 3 plans. Company A (Wife), Company B (You), Company C (HRA). (If company B and C are the same, that's fine, it is still a separate plan.)

Your wife will get covered under Company A. Company B will not pay anything. But Company C is your "Bank Account" to cover all qualified medical expenses, which includes Co-pays, deductibles etc. Company B won't be paying anything because of the 80/20 split, but they will be paying your deductibles/co-pay, from your "HRA bank account".

No, in my case as least the HRA is directly managed by the Company B in your example. If they don't pay, the HRA funds are unused.

So far the best advice I see here is to try and see if I can cancel the wifes insurance completely at anytime. Dus10, it sounds like you have a little experience with this mess, what do you mean by coordination of benfits done properly? As far as I know it's simply whatever method the insurance companies go by that you're stuck with. In my case mine uses a non duplication of benefits method which means if they would have paid out the same or less than the primary, they don't pay anything. Since my HRA is attached to them that means my "free money" can't be used and it comes out of pocket. FYI for those that don't know a HRA is like a HSA but the funds come from the employer instead of the employee.

† They are probably the third-party administrator for the money -- it's probably actually part of a separate†plan.

Review your documents. †HRA Funds pay for any qualifying medical expense. †
Take this as an example... if you only had your company plan, and you had trouble getting pregnant, many plans exclude fertility issues. But fertility issues are reimbursable under HRA guidelines. †Therefore insurance denies the claim, BUT you are still able to pay with HRA, or pay out of pocket and be reimbursed by the HRA fund.
Think of an HRA similar to an FSA, but for medical services only, not prescriptions, etc. † It doesn't matter that Company A paid the 80%. †Company B still owes you for the 20%, up to what you have in your account.

dobby10 said:   
stanolshefski said:   
foglem said:   
plastrd said:   Do insurance companies check with each other to see if a person has multiple policies when processing a claim? It seems like you could just give them your insurance card for the policy you want to use and never mention the other one.
† They do require you provide COB information (coordination of benefits) that is accurate. If you do as you say it's possible you'd get away with it for awhile. But if they find out you're in a world of hurt when all the charges reverse. Don't do this!
dobby10 said: Review your plan documents. I think you are looking at this 100% incorrectly....

You technically have 3 plans. Company A (Wife), Company B (You), Company C (HRA). (If company B and C are the same, that's fine, it is still a separate plan.)

Your wife will get covered under Company A. Company B will not pay anything. But Company C is your "Bank Account" to cover all qualified medical expenses, which includes Co-pays, deductibles etc. Company B won't be paying anything because of the 80/20 split, but they will be paying your deductibles/co-pay, from your "HRA bank account".

No, in my case as least the HRA is directly managed by the Company B in your example. If they don't pay, the HRA funds are unused.

So far the best advice I see here is to try and see if I can cancel the wifes insurance completely at anytime. Dus10, it sounds like you have a little experience with this mess, what do you mean by coordination of benfits done properly? As far as I know it's simply whatever method the insurance companies go by that you're stuck with. In my case mine uses a non duplication of benefits method which means if they would have paid out the same or less than the primary, they don't pay anything. Since my HRA is attached to them that means my "free money" can't be used and it comes out of pocket. FYI for those that don't know a HRA is like a HSA but the funds come from the employer instead of the employee.

† They are probably the third-party administrator for the money -- it's probably actually part of a separate†plan.

Review your documents. †HRA Funds pay for any qualifying medical expense. †
Take this as an example... if you only had your company plan, and you had trouble getting pregnant, many plans exclude fertility issues. But fertility issues are reimbursable under HRA guidelines. †Therefore insurance denies the claim, BUT you are still able to pay with HRA, or pay out of pocket and be reimbursed by the HRA fund.
Think of an HRA similar to an FSA, but for medical services only, not prescriptions, etc. † It doesn't matter that Company A paid the 80%. †Company B still owes you for the 20%, up to what you have in your account.

† There are lots of ways an HRA can be used. For example: At my employer, it can only be†used to offset a portion of the deductible.

stanolshefski said:   
dobby10 said:   
stanolshefski said:   
foglem said:   
plastrd said:   Do insurance companies check with each other to see if a person has multiple policies when processing a claim? It seems like you could just give them your insurance card for the policy you want to use and never mention the other one.
† They do require you provide COB information (coordination of benefits) that is accurate. If you do as you say it's possible you'd get away with it for awhile. But if they find out you're in a world of hurt when all the charges reverse. Don't do this!
dobby10 said: Review your plan documents. I think you are looking at this 100% incorrectly....

You technically have 3 plans. Company A (Wife), Company B (You), Company C (HRA). (If company B and C are the same, that's fine, it is still a separate plan.)

Your wife will get covered under Company A. Company B will not pay anything. But Company C is your "Bank Account" to cover all qualified medical expenses, which includes Co-pays, deductibles etc. Company B won't be paying anything because of the 80/20 split, but they will be paying your deductibles/co-pay, from your "HRA bank account".

No, in my case as least the HRA is directly managed by the Company B in your example. If they don't pay, the HRA funds are unused.

So far the best advice I see here is to try and see if I can cancel the wifes insurance completely at anytime. Dus10, it sounds like you have a little experience with this mess, what do you mean by coordination of benfits done properly? As far as I know it's simply whatever method the insurance companies go by that you're stuck with. In my case mine uses a non duplication of benefits method which means if they would have paid out the same or less than the primary, they don't pay anything. Since my HRA is attached to them that means my "free money" can't be used and it comes out of pocket. FYI for those that don't know a HRA is like a HSA but the funds come from the employer instead of the employee.

† They are probably the third-party administrator for the money -- it's probably actually part of a separate†plan.

Review your documents. †HRA Funds pay for any qualifying medical expense. †
Take this as an example... if you only had your company plan, and you had trouble getting pregnant, many plans exclude fertility issues. But fertility issues are reimbursable under HRA guidelines. †Therefore insurance denies the claim, BUT you are still able to pay with HRA, or pay out of pocket and be reimbursed by the HRA fund.
Think of an HRA similar to an FSA, but for medical services only, not prescriptions, etc. † It doesn't matter that Company A paid the 80%. †Company B still owes you for the 20%, up to what you have in your account.

† There are lots of ways an HRA can be used. For example: At my employer, it can only be†used to offset a portion of the deductible.

† Unless I'm missing something, I'm simply re-iterating what I said earlier, and backing up what you said.

HRA's can come in many forms. Mine can not be used for anything but claims to my insurance being paid out. It's just how it is, if I can drain it I'll likely flip to a HSA instead.

But, on the off chance you're on to something here I'll make a call tomorrow to double check this. Worth a try...

foglem said:   HRA's can come in many forms. Mine can not be used for anything but claims to my insurance being paid out. It's just how it is, if I can drain it I'll likely flip to a HSA instead.

But, on the off chance you're on to something here I'll make a call tomorrow to double check this. Worth a try...

††
An HRA is an HRA, it is an IRS Term. †There can be some different guidelines, but the concept is the same across all I've seen. What insurance company? Most of the majors have a list posted of what qualifies as a reimbursable HRA expense.
Here is just a sample from a small business plan administrator:†http://www.conexismarketing.com/employees/eligible-expenses/fsa-...
The same insurance company is just the administrator for the separate HRA Plan, because it simplifies paying providers. Personally, when I had an HRA through Cigna, I turned off autopay, and managed all payments myself.

Well, things are certainly not looking good. The HRA as I thought is tied to Anthem insurance and can't be used for any purpose they don't approve through their insurance.

The wife heard back from her HR department, her plan can not be cancelled except during the qualifying life event or open enrollment.

Looks like I'm back to my same original options, take it as it is, switch on the QLE to cancel her insurance effective AFTER delivery (billing nightmare is expected to follow me for months afterward), or she could quit and try to reestablish work after. I don't like any of these options but will most likely just pay it out and take it as a lesson learned.

Also I learned my policy actually has a "primary only" implementation. The things I should have done my homework on...



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