1. Will your policy provide you with cover both at work and away from your job?



Many health insurance policies contain specific exclusions that eliminate your benefits for anything that could have been covered by Workers Compensation or a similar law. Now read that last sentence again and pay particular attention to the words 'could have been covered'. That's right, the majority of self employed individuals and even a few small business owners do not carry Workers Compensation on themselves.

There are specific insurance policies which will cover you on and off the job, if the law doesn not require you to have Workers Compensation coverage.

2. Are you writing off your health insurance premiums?

Independent contractors (1099's), home based business owners, professionals and a lot of self employed individuals are not taking advantage of the tax laws available to them.

Many individuals who are paying 100% of their own costs are allowed to deduct their monthly insurance payments. This by itself can lower your out-of-pocket costs by up to 40%. Ask your accountant if you are eligible or check out the IRS website to get more information.

3. Look closely at any plan's internal limits

All insurance plans use some form of internal controls which determine how much the company is prepared to pay out for a specific service or procedure. There are two basic methods which are used:

A. Scheduled Benefits

A lot of plans, some of which are marketed specifically to indpendent and self employed individuals, have a detailed schedule of how much they will pay per visit to the doctor, stay in hospital or even what limits are placed on payments for testing within a 24 hour period. This structure is normally seen in 'Indemnity policies'. If you are offered one of these plans make sure that you see the schedule of benefits in writing. It is very important that you understand these type of limits up front because once they have been reached the insurer will not pay any expenses above the stated amount.

B. Usual and Customary Expenses

'Usual and Customary' refers to the payment for a visit to the doctor's office, procedure or hospital stay that is based on what the majority of doctors and facilities charge for that particular service in that geographical or comparable area. 'Usual and Customary' charges represent the maximum level of coverage on most major medical policies.

4. Do not forget that you are able to shop around

Because you are reading this there is a fair chance that you are shopping for a health plan.

Every day people shop for everything from food to a new house and while shopping value, price, personal needs and general marketplace conditions are evaluated by the buyer. Bearing this in mind, it is very disconcerting that the majority of people never ask what a test, procedure or even doctor visit will cost. In this constantly changing insurance market it will become increasingly important for these questions to be asked. Inquiring about price will help you get the most out of your policy and lower your out-of-pocket expenses.

5. Look out for networks and discounts

Nearly all insurance firms work with medical networks in order to access discounted rates. In broad strokes, networks are composed of of medical professionals and facilities who agree to charge discounted rates for services provided. In the majority of cases the network itself is one of the defining attributes of your program. Discounts will vary from 10% to 60% or more.

Medical network discounts do vary but in order to ensure that you pay the lowest out-of-pocket expenses, it is vital that you check out the network's list of doctors and facilities before committing yourself to a plan. This is not only to make sure that your local doctors and hospitals are included in the network, but also to see what your choices would be if you need referral to a specialist.