Some time ago I wrote about how critical illness insurance policies could be an affordable alternative to more comprehensive health insurance, and suggested that self-pay patients might want to look into getting this sort of policy in order to provide funding in the event they are diagnosed with cancer, have a heart attack, or are hit with some other grave illness.
This morning I ran across an insurance agency in Texas that is marketing critical illness policies with the same idea in mind. People who favor the Patient Protection & Affordable Care Act (better known as Obamacare) might be a little turned off by their site, as it appears they are explicitly targeting opponents of the law with their marketing, including the name of the insurance agency: Obamacare Alternatives.
The agency appears to be aiming primarily at small business owners who want to provide some health benefits to their employees but just can’t afford a comprehensive insurance plan (and don’t like Obamacare). Here is some excerpts from a letter to prospective Obamcare Alternatives customers on their site (I’ve tried to edit out some of the more politically-oriented language):
Dear Business Owner, Taxpayer & Citizen,
As you know, Obamacare is set to go off 10/01/2013. So the question begs “are you prepared”?
…Do we need healthcare reform? Absolutel… We need healthcare reform that looks like responsible consumer purchasing. Holding doctors to responsible pricing. While not allowing them to run up the costs, just because you have insurance. The website www.healthcarebluebook.com gives consumers the average cost per procedure in their area. Consumers can then take the prices for the procedure to their doctor and get him to sign off on it. If he refuses, maybe it is time to find another doctor.
… We offer a suite of products that specifically meets the needs of individuals not to enrolling in the exchanges. Our plans offer similar benefits and many times much better benefits that what you can expect in the exchanges.
- Healthcare plans
- Large sum critical illness plans
- Cancer specific plans
And here’s a brief explanation of how critical illness policies are an alternative to comprehensive insurance:
Critical Illness Insurance is an insurance product, where the insurer is contracted to typically make a lump sum cash payment if the policyholder is diagnosed with one of the critical illnesses listed in the insurance policy. The schedule of insured illnesses varies between insurance companies.
Examples of conditions that may be covered include:
- Alzheimer’s Disease
- Kidney Failure
- Multiple Sclerosis
- Parkinson’s Disease
- Terminal Illness
Critical illness may be purchased by individuals in conjunction with a life insurance or term assurance policy at the time of a residential purchase, known as a ‘bolt-on’ benefit.
The finances received could be used to:
- pay for the costs of the care and treatment
- pay for recuperation aids
- replace any lost income due to a decreasing ability to earn
- and for a change in lifestyle
… In this type of product design, some insurers may choose to structure the product to repay a portion of the outstanding mortgage debt on the contracting of a critical illness, whilst the full outstanding mortgage debt would be repaid on the death of the policyholder. Alternatively, the full sum assured may be paid on diagnosis of the critical illness, but then no further payment is made on death, effectively making the critical illness payment an ‘accelerated death payment.
Some employers may also take out critical illness insurance for their employees. This contract would be in the form of a group contract and has become an essential strategy used by employers around the world to both protect their employees financially as well as attract more employees to consider working for the company.
Oddly, the description doesn’t include some of the diseases that are most commonly covered by critical illness policies, such as cancer, heart disease, and stroke. Most likely an oversight, but anyone contacting the Obamacare Alternatives agency to use their services might want to double check on this and see if those diseases are covered.
I assume Obamacare Alternatives is only licensed to work in Texas, which means small-business owners in the other 49 states interested in these sorts of innovative health benefit plans would still need to find someone else. One agent I’m familiar with who might be able to help (and I believe he’s licensed in multiple states) is Ralph Weber of Route Three Benefit Consultants (Ralph is also the founder of MediBid, so he’s no stranger to self-pay health care!).
I also know of one other agent who is focusing on self-pay patients who are interested in alternative types of insurance, Dustin Knoedler of Ohio. I believe he’s also licensed in multiple states, and is able to refer people to agents in other states where he’s not licensed. Dustin also sells membership in Connect2Docs,* a bundled package of services for self-pay patients that includes telemedicine, a medical bill negotiation service, and a discount card on prescription drugs.
There seems to be a growing awareness of the need for affordable alternatives to comprehensive health insurance, both in the small-business and individual markets, and innovative insurance agents and benefits consultants like Obamacare Alternatives, Ralph, and Dustin are stepping up to meet this need. There are others I’m sure, and I hope my readers will let me know of anybody else I should be aware of!