Health Insurance For RVers
For a lot of people, health insurance is a major obstacle to overcome before deciding to become a full-time RVer. With a little research and planning I don’t see any reason why it has to be a prohibiting factor so long as your expectations are reasonable and your risks are properly managed.
The two main health insurance issues that have to be addressed for RVers are affordability and portability. Let’s talk about these briefly…
Of course, “affordable” is relative. What I consider affordable, you might not, and visa-versa. So, let’s see what we can do to make health insurance affordable for you. The best thing you can do is to manage your risks and expectations.
Health insurance is risk management. That’s what it was created for and if it goes beyond doing that then it can become very expensive. Instead of looking at health insurance as a “healthcare payment plan”, try looking at it as “asset protection”. In other words, don’t buy insurance to help pay for every little healthcare need in your life. Instead, buy health insurance to protect your family from serious financial disruption should a significant healthcare need arise (i.e. major surgery, lengthy hospital stays, disability, etc.). Here are the key ways you can do this:
- Share some costs: Having even a small deductible or co-insurance can go a long way in helping to reduce your premiums.
- Compare plans and carriers: You might be surprised at how much you can save just by comparing like-plans across multiple insurance carriers.
- Stay healthy: It goes without saying, really, that the best way to manage our risk is to eat right, exercise, manage our stress, etc.
I highly recommend reading this great blog series from “Wheeling It” about self-testing and other preventative care ideas for RVers. It discusses ideas for taking control of your own healthcare as much as you can while on the road.
Of course, you can exercise 5 days a week and eat everything ‘right’ and medical issues can still occur. It’s these unforeseen medical issues that you should insure against. You want to make sure a significant health problem does not also become a significant financial problem.
Portability is the unique issue RVers have to deal with when shopping for health insurance. We are usually hundreds of miles from our primary care doctor…if we even have one (having a telehealth/edoc plan can help a lot with this issue!). Furthermore, most insurance plans are not designed for nationwide coverage and require us to receive our care close to where we purchased the policy in order to maximize its benefits.
So, when deciding which insurance plan to purchase it will be very important to check 2 things:
- Will the company insure RVers?: Some carriers have it written in their insurance policy contracts that they will not insure RVers! Make sure you do not choose one of these. Others might require you to physically be in the state for a minimum period of time each year–say, 6 months.
- What does the plan network look like?: After checking the carrier’s policy on insuring RVers, it will be important to view the details of the plan’s network. Will it cover you in all 50 states or just 12 of them? Also, be sure and check the out-of-network benefits. Some plans have very limited benefits out-of-network.
The Affordable Care Act
With the advent of the Affordable Care Act (ACA) there are some changes in health insurance access that will likely prove to be very helpful for some current and wannabe RVers. It’s too early to draw any overall conclusions good or bad about the law’s impact on travelers; However, for two groups of people there are potential good outcomes from the law:
- People who could not purchase coverage due to pre-existing conditions: The ACA makes it unlawful for an insurance company to deny you coverage because of pre-exising health conditions.
- People who could not afford coverage: With the new subsidies available to people who purchase insurance on the federal Marketplace, health insurance could now become very affordable to people who qualify.
With these two big changes in our health insurance laws, you might not have to hang on to your employer-provided health insurance any more…which, of course, means you might be able to loose yourself from your employer’s “golden handcuffs”!
However, from a portability standpoint, there isn’t anything in the ACA that will specifically benefit the RV community. In fact, early indications are that the plans purchased on the federal exchange might be even more restrictive than plans purchased outside of the exchange. What I mean is, if you purchase a plan on the exchange you should pay careful attention to the plan’s network of providers. In some cases the plans do not allow you to receive any care (even emergency care!) outside of the state in which the plan was purchased.
For detailed information about the ACA please visit our page dedicated to explaining this new legislation.
Our Recommendations for RVers NOT on Medicare
As stated above, the best ways to keep your health insurance costs down are to:
- Share costs in the form of deductibles and co-insurance
- Compare plans with multiple carriers
- Stay healthy
So, with those things in mind, I would recommend getting a high deductible health plan that is HSA compatible. HSA stands for Health Savings Account, which is a tax-advantaged medical savings account available to people who are enrolled in a high-deductible health plan. The funds contributed to an HSA account are not subject to federal income tax at the time of deposit. Plans that are HSA compatible will be labeled as so.
For 2015 the HSA maximum contributions are $3350 per individual and $6650 per family. If you are over 55 you can make additional “catch up” contributions of $1000 per individual.
If you are under 30 years old…
I recommend getting a Catastrophic (Cat) plan. Under the Affordable Care Act there are 5 tiers of coverage: Catastrophic, Bronze, Silver, Gold, Platinum. Cat plans are only ACA-compliant for people under age 30. So, if you are over 30 you could still get one but it would not qualify as minimum essential coverage…meaning you could still have to pay the tax penalty. Of course, as is the case with most of the healthcare rules, there are extensive exemptions for this.
A Cat plan carries a $6350 self-only deductible and $12700 family deductible and an “actuarial value” of less than 60%, which means it is required to have an over-all value of paying up to 60% of medical bills. That might not sound like enough coverage until you factor in the out-of-pocket maximum. The out-of-pocket maximum on all ACA plans is $6350 for self-only and $12700 for family. So, the 60% really is not a significant number because once your deductible is met you are covered at 100%. Of course, you still get all of the required essential health benefits as required by ACA as well as 3 annual primary care visits without having to meet your deductible. The one caveat to the Cat plan: you can not apply premium tax credits (subsidy) that you might qualify for. If you qualify for a premium tax credit then I’d suggest a Bronze level plan.
If you are over 30 years old…
We recommend getting a Bronze plan in order to keep your premiums low. A Bronze plan must have an “actuarial value” of at least 60%. Like all ACA-compliant plans, the Bronze plan has a out-of-pocket maximum of $6350 for a self-only plan and $12700 for a family plan. Deductibles will vary on Bronze plans from $1250-$6350; but once your deductible is met you will have 100% coverage for all covered medical and prescription drug costs. If you qualify for a premium tax credit (subsidy) then Bronze is the least amount of coverage you can have in order to apply your credit.
Of course, you will apply some wisdom to this advice, and if you can get a Silver, Gold, or Platinum plan at a better rate or you prefer the higher levels of coverage, then buy accordingly. Also, if you are over 60 you will need to weigh whether having an HSA-eligible plan is necessary given that you may only have a few years to contribute to the HSA before Medicare.
If you qualify for a subsidy…
A Silver plan might make more sense if you end up qualifying for a federal subsidy. There are two types of subsidies:
1. Premium Tax Credit: This subsidy is what you would use to help pay your monthly premiums. You can apply it monthly (a “credit”) or receive it as a refund when you file your taxes. It can be applied to all metal tier plans: Catastrophic, Bronze, Silver, Gold, and Platinum.
2. Cost Sharing Reduction: This subsidy can be used to reduce deductibles and out-of-pocket maximums on Silver plans only. Not everyone qualifies for this subsidy, even if you qualify for the Premium Tax Credit.
So, if you qualify for the Premium Tax Credit and the Cost Sharing Reduction then you will likely be better off with the Silver plan since your plan’s out of pocket costs will be greatly reduced. You can not use a Cost Sharing Reduction on Catastrophic, Bronze, Gold, or Platinum plans.
Portability is the unique issue RVers have to deal with when shopping for health insurance. We are usually hundreds of miles from our primary care doctor…if we even have one. Furthermore, most insurance plans are not designed for nationwide coverage and require us to receive our care close to where we purchased the policy in order to maximize its benefits.
So, when deciding which insurance plan to purchase, here is my advice for maintaining portability:
Stick with a Preferred Provider Organization (PPO). We recommend you avoid most Exclusive Provider Organizations (EPO) and ALL Health Maintenance Organizations (HMO) when looking for a plan. There may be exceptions to this rule if the EPO or HMO has PPO-like benefits when traveling outside the state.
- EPO: These plans often have a more strict network than HMOs but they do not require the use of a primary care physician nor a referral to see a specialist. In order to receive benefits under a EPO you must stay in the plan’s network, though. So, you have to make sure you check with each provider you go to. EPOs are generally restricted to a state and sometimes only a few counties…or even one county! There may be exceptions to this with some carriers.
- HMO: These plans require the use of a primary care physician and referrals to all specialists. Like EPOs they require you to stay in network to receive benefits unless it is for emergency care. HMOs do not offer any other benefits when out-of-network.
- PPO: Preferred Provider Organizations allow you to use doctors in and out of network. Benefits are generally lower outside of network but the network is usually much larger than EPO and HMO networks. These are sometimes referred to as Point of Service plans (POS).
Our summary recommendation for attaining the most portable and affordable coverage:
Find an HSA-compatible Catastrophic, Bronze, or Silver (Silver esp. if you qualify for a subsidy) PPO plan with a large nationwide network
This is very general advice! Specific carrier recommendations are going to be based on your chosen state of domicile. Please contact us for those state-specific recommendations!