Health insurance coverage and health care plans help with the medical costs of diagnosis and treatment of a child's illness. It is important to have and keep good health insurance coverage. This can help families avoid financial hardship. Many parents are insured through employee group plans or individual plans.

Group plans

A group plan is a policy that covers a group of people, usually employees of the same company, and their dependents. In general, employees and their families do not have to prove that they are healthy to be insured with their job's plan. Group plans usually cost less and some employers pay part of the premium for the employees.

Individual plans

Individual plans may check into your and your family's health. They may require physical exams or lab tests before they will insure you. They often charge higher rates or premiums based on your age or health conditions, and in some cases, may not be willing to insure you at all. Some individual policies can also cover family members, though some may not cover children.

It is important to have accurate, up-to-date information and a good understanding of your financial situation and insurance coverage. And, if your insurance cost is not deducted from your paycheck, it is very important to pay your monthly insurance premiums on time.

Types of health plans

There are different types of health insurance and health service plans. Here are very brief descriptions of those that are most often used:

Indemnity, fee-for-service, or traditional health plans

If you have this type of health insurance, you can choose any doctor, change doctors any time, and go to any hospital anywhere in the United States. You pay a monthly fee, called a premium. Each year, you also have to pay a certain dollar amount of the medical costs (known as the deductible) for yourself and each family member before your insurance will start to pay medical expenses. After you have met your child's deductible, your insurance will pay a set percentage of the bill. You are responsible for the rest, which is called a co-payment or co-insurance.

You may have to fill out forms and send them to your insurer to get reimbursed (paid back) for medical costs you have already paid. Sometimes the doctor's office will do this for you, and then send you a bill for the amount your insurance didn't cover. You need to keep receipts of your child's drugs and other medical costs to keep track of these medical expenses. This can help you greatly if there is a dispute about payments or other problems in the future.

After your stated deductible is met, the insurance company will pay a percentage (75% to 80% is common) of the costs or claims submitted to them. Some policies have a limit or cap on the total costs that must be paid by the beneficiary (a person who gets benefits) in a calendar year. This means that, after a certain amount (cap) is paid out of pocket, the company pays 100% of "usual and customary" charges. Since the insurance company decides what is usual and customary, there are often still uncovered costs that families must pay beyond the co-pay and their out-of-pocket limit for the year. You should always ask if the insurance company will waive (or not make you pay) the amount above the usual and customary charges.

Many policies have a lifetime benefit maximum (the total amount the insurer will pay during the lifetime of each covered person using benefits). Even a lifetime limit of $1,000,000 can be a problem for people who need very expensive treatments or whose cancers come back.

Managed care health plans

There are many different types of managed health care plans. Most of them have lower premiums and co-payments than fee- for-service insurance. (Co-payments may also be called co-insurance. This is the amount you must pay at the time of service.) These amounts can differ among managed care companies and among services within the company. There is usually no need to file claim forms. These plans most often cover preventive health care as well as serious illnesses. Individuals and families may belong to:

• Health maintenance organization (HMO): a health care plan that provides medical services to its members, usually in return for a fixed, pre-paid fee. The HMO will usually cover expenses after a small co-payment. HMOs often limit your choice to those within their approved provider network. This means you have to check their listing to be sure the doctor you want to treat your child is one of their doctors. If not, you may have to change to a different type of health plan to have the doctor's services covered. Or, you may have to switch to one of the approved doctors on their list.

• Preferred provider plan (PPO): a hybrid of fee-for-service and an HMO. Like an HMO, there are only a certain number of doctors and hospitals you can use to get the most coverage. When you use those doctors (sometimes called preferred or network providers), most of your medical bills are covered. When you don’t use these providers, the PPO makes you pay more of the bill out of your own pocket. So you pay more to choose providers that are not in the network. There may also be a deductible each year.

• Point of service (POS) plan: a type of HMO that also allows you to choose providers that aren't in the network. The primary care doctors in a POS plan usually refer your child to other doctors in the plan or network. If your POS doctor refers your child to a doctor who is not in the plan (out of network), the plan will still pay all or most of the bill. But if you choose a doctor outside the network for your child, you will have a co-pay even if the service is covered by the plan.

Know your managed care plan

Some plans employ their own doctors and run their own hospitals. Others require plan members to use a primary care provider who coordinates all of the patient's care and serves as a gatekeeper for care from specialists. A gatekeeper is usually a primary care doctor who is responsible for the overall medical care of his or her patient. This doctor organizes and gives permission for medical treatments, tests, specialty referrals and hospitalizations. For example, if a child needs to see an expert like a lung specialist, you would need a referral from the primary care doctor before the specialist saw the child in order to be paid by the insurance company. If this is not done the plan may not pay.

Under some plans, members must use only the services of certain providers and institutions that have contracts with the plan. Some plans do not require prior approval or pre-authorization, but do require that members choose providers from a particular list or network of providers. When parents choose to go outside the network for their child's care, they may have to pay an extra fee, or they may have to pay for the full service.

Many different types of institutions and agencies sponsor managed care plans, not just insurance companies. These include employers, hospitals, labor unions, consumer groups, the government, and others. It's important to know all the ins and outs of the plan and how it will affect your child's care.

Other things to know about health insurance

Catastrophic illness or major medical clauses

Treating and managing most cancers costs a lot. Some insurance plans provide for extra coverage under a catastrophic illness clause. Catastrophic illness policies cover major medical care needs. The policies usually have very high deductibles and fairly low premiums. They are useful when a person's primary medical policy has a limited lifetime limit and when a person has a chronic illness. These policies may be sold separately or be part of another type of coverage. Check to see if your plan includes such coverage.

Pre-existing condition exclusions

If your child has cancer or has had cancer in the past, find out if there is a pre-existing condition exclusion period when you join a new health plan. A pre-existing condition is a health problem that a person had BEFORE joining the health plan. If there is a pre-existing condition exclusion period, your plan will make you wait before they pay the costs of the pre-existing medical problem. For insurance through an employer, the wait may be as long as a year . If you refuse health insurance when it is first offered and then sign up later, the pre-existing condition exclusion period may be as long as 18 months after you sign up. And the period can be longer for independent policies and those not offered through an employer. In fact, some insurance may not cover certain illnesses at all.

If you get health insurance through your job, Federal law prevents the employer from imposing an exclusion period for a pre-existing condition in some situations. You may be able to avoid this exclusion period if your child had health insurance coverage from a parent's previous employer and has not been without coverage for more than 63 days. Some states require an employer-based insurance company to cover pre-existing conditions even if the beneficiary was without insurance for a bit more than 63 days. You can call the U.S. Department of Labor at 1-866-444-3272 for more information about your specific situation. (See the section, "The Health Insurance Portability and Accountability Act of 1996" for more information.)

If you are enrolling in a plan that is not group coverage (including high risk pools), the pre-existing condition exclusion period can be many years or even unlimited. If you are getting a plan through someone other than an employer, the insurance provider can impose a restriction called an elimination rider that would keep that disease, body part, or body system from ever being covered by that policy. You can ask to have the rider changed or eliminated, but the health care plan doesn't have to do it. It's important to know about these things, before you sign up.

National law will prohibit discrimination based on genetic testing or test results

The health insurance provisions of the Genetic Information Nondiscrimination Act (GINA) take effect on May 21, 2009. GINA applies to all health insurance plans (including federally regulated plans, state-regulated plans, and private individual plans). GINA defines genetic information as (1) an individual’s own genetic tests; (2) the genetic tests of family members; and (3) one or more family members with a genetic disease or disorder.

The law will prohibit discrimination in costs and coverage based on genetics. This means:

• GINA will not allow health insurers to turn down individuals or charge higher premiums for health insurance based on genetic information or the use of genetic services, such as genetic counseling.

• GINA bars group health plans, individual plans, and Medicare supplemental plans from using genetic information to limit enrollment or to change premiums.

• It also bars these insurers from requesting or requiring genetic tests.

The law also forbids employers from discriminating based on genetic test results or genetic information. (no matter how they got the information) in hiring, firing, layoffs, pay, or other personnel actions such as promotions, classifications or assignments. This part of the law takes effect November 21, 2009.

Look carefully at your health insurance options at work

Look closely and compare plans if you are trying to decide among several insurance or managed care options. Sometimes there is a chance to look at and consider different types of coverage during open enrollment periods. (Open enrollment is the time period you can make changes in your coverage. It usually happens once a year.) Sometimes it is possible to add yourself, your spouse, or a child to a work health insurance policy outside the open enrollment period if you've had a major change in situation; for instance, if you've gotten married or your spouse has been laid off. Check with your health insurance administrator at work about this.

Health insurance for college age children

If you have group insurance with your employer that covers your child, you will want to find out its limits. If your child is listed as your dependent for tax purposes, you may be able to cover the child under your group policy at work even if the child is older than 18. Often, the child who is in college full time can be kept on your policy to age 23 or 25. After the age limit is reached, you must notify your insurance administrator about the child reaching non-dependent age. At that point, your adult child can either look for other health coverage, or request COBRA coverage for a limited time on your insurance if other insurance can't be found (see the section, "COBRA"). There are other options for many college students, such as college health policies, individual insurance, state risk pool, or even group insurance if the student is employed. For more information about options for college students, see Health Insurance and Financial Issues for the Cancer Patient.

Hospital indemnity policies

Hospital indemnity policies, sometimes called supplemental medical policies, pay a fixed amount for each day a person is hospitalized. Not all indemnity policies cover children, and some that do pay a lower rate for days that children are in the hospital than they do for adults. The money received from such policies can be used as the insured wishes. It is often used for medical costs not paid by the insurance company, or the other expenses that families face when a member is ill. There may be a limit on the total number of hospital inpatient days a policy will pay in a calendar year or a cap on the total number of days it will pay.

Case managers and financial assistance planners

Hospitals, clinics, and doctors' offices often have someone who can help you fill out claims for insurance coverage or reimbursement. A case manager or a financial assistance planner may be able to help guide you through what can be a complicated process.

How to manage your child's health insurance

DO NOT allow your child's health insurance to expire. If you are changing insurance plans, don't let one policy lapse until the new one goes into effect. Pay premiums in full and on time. It can be difficult and expensive to get new insurance.

The following are ideas to help you and your family better understand your child's health coverage:

• Find all insurance information referring to the child's current medical problem.

• Carefully read and review any booklets explaining the plan under which your child is covered. You may find more on the company's or the insurance carrier's Web site.

• Ask for written information on benefits if you do not have it, and be sure you understand the details. Get a copy of your plan's summary description (SPD), which tells you how it works, what benefits it provides, and how to get the benefits or file your claim. If you think you might need more insurance, ask your insurance carrier if it is available.

• Talk with the employee benefits person at your job (usually a person in the human resources department) if you have questions or do not understand what you're reading.

• Make a list of any questions about benefits, deductibles, and coverage.

• Get answers directly from the insurer or managed care group that covers your child.

• Be sure you understand what you need to do to make sure that services are covered.

• Identify one contact person (if possible) in customer service at the insurance company with whom you can discuss claims and services. It will help to have one person who becomes familiar with your situation. This person may be a case manager.

• Meet with a hospital or clinic financial counselor or a person from the patient accounts office where your child is being treated to learn about billing procedures and what you can expect.

• Discuss any concerns about your insurance with your child's cancer team social worker. He or she can help you understand how the system works and where to get help.

• Ask for help from a trusted friend if you feel overwhelmed in dealing with these matters.

• Develop a system for keeping records. For example, you may keep records arranged by visit date or by health provider, whatever works for you.

Dealing with medical bills

• Submit claims for all medical expenses even when you are not sure if they are covered.

• Keep accurate and complete records of claims submitted, pending, and paid.

• Keep copies of all paperwork related to your claims, such as letters of medical necessity, explanations of benefits (EOBs), bills, receipts, requests for sick leave or FMLA leave and correspondence with insurance companies.

• Get a caseworker, a hospital financial counselor, or a social worker to help you if your finances are limited. Often, companies or hospitals can work with you to make special payment arrangements if you let them know about your situation.

• Send in your child's bills for reimbursement as you get them. If you become overwhelmed with bills, get help. Contact local support organizations, such as your American Cancer Society (ACS)or your state's government agencies, for extra help in finding resources.

Back to Children Diagnosed with Cancer: Financial and Insurance Issues

Last Medical Review: 04/01/2009
Last Revised: 04/01/2009