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Health Plan Reviews by State

Why are  Hoodles Health Plan Reviews Divided by State?


One of the first things you will notice when using Hoodles to compare health insurance plans is the immediate division by State.  Why is that?  Shouldn’t a person see all plans regardless of State to compare the best available options?  The key word there is “available” as we’ll see.  Let’s take a look at the State dividing line in health insurance.


51 flavors in health insurance

Despite the Federal health reform bill, health insurance is still very much a State by State enterprise.  Each State is responsible for regulation of the health insurance market in their State through their Department of Insurance.  For this reason, plans, rates, and carriers are all governed at the State level.  If a carrier wants to roll out a health plan in another State (which some do), they still have to essentially file and offer new plans in that State even if they have other plans somewhere else.  Laws, rules, and requirements are different from State to State so you really need to look at the plans available in your State to compare health plans.   You actually can’t apply for a health plan offered in another State if you don’t have residency there.  What really drives this?


Provider networks and Rates

The vast majority of health insurance plans are “managed” care plans which means that they are PPO or HMO plans.  PPO and HMO plans from a carrier perspective are only as strong as their contracts with providers.  It’s hard enough to negotiate successfully with providers (doctors and most important hospitals) in your own State much less another State where you don’t have many members.  In the end, a carrier goes to a hospital networks and says, “Look 30% of you patients have our insurance.  When they walk in the door, discount their costs by 40%”.  It’s essentially a big group discount.  The hospital goes along since it’s a lot of potential business (30% after all).  How does that carrier approach a hospital in another State where few of their members actually go?   They will have to pay more than the local carrier which dominates that State (and therefore negotiates better).  Keep in mind that the margin for carriers is around 3-4% for healthy carriers.  A small difference in negotiated rates can quickly make you more expensive than another carrier.  This favors local and large health insurance carriers which makes the health insurance market a local State enterprise.


How to get your State’s best health plans

So we need to start the whole process in comparing health plans through Hoodles by first selecting our State.  This will bring up the relevant plans for us and keep in mind that there are regional strengths by State.  A large nationwide carrier (naming no names) may have strong networks in one State but not another.  This is not uncommon since each State operates slightly differently.  If you are moving to another area, the individual family market will soon be guaranteed issue which means that you can qualify regardless of health and this is a great time to use Hoodles since you will not yet have a good sense of which carriers are good in your new locale and as we mentioned…a strong carrier in one State is not necessarily a strong one in your new State.  Best to find out from locals by reading the health plan reviews in the new State.  Oh yea…that’s Hoodles.

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