Payment Options for your Arizona Health Insurance Plan

In the past, the Arizona health insurance carriers have provided several different options for the consumer to make his or her premium payments.  Payments could be made on credit cards, on monthly bank drafts or  with a paper bill.  These options are being narrowed down as the insurance companies try to cut the administrative cost of doing business.

For example , the insurance companies are getting away from using credit cards for anything except the initial premium that is mailed in with the application. Recently HealthNet of Arizona announced it was eliminating the use of credit/debit cards as a monthly payment option on the Individual and Family plans in Arizona as well as nationwide beginning July 1, 2012.

Like many other Arizona health insurance carriers, HealthNet will continue to take the initial payment on a credit card, which is particularly important in facilitating an on-line application. But for payment over the long term, it recommends, like most carriers,  that clients set up an automatic bank draft (ABD) or opt to receive a paper bill.

What are some of the advantages in using the automatic bank draft to pay for coverage?

There is a cost savings to the carrier to go to automatic bank drafts, of course,  They do not have to pay the service charges paid by the credit card companies, which can be substantial amount when spread over thousands of consumers.

There  are also some advantages for the consumer, however.  There is no need to worry about the premium statement getting lost in the mail, or being overlooked in the stack of bills on the dining room table. You can factor the payment into your monthly schedule, since it will be withdrawn at almost the same time every month. It will be one less thing to worry about in your buy schedule.

Carriers  are also trying to discourage clients from setting up "paper bills."   For the carrier there is the cost of postage and printing the invoices. Multiplied over thousands of individual, this, too, can be substantial. Some Arizona health insurance carriers have gotten away from the practice altogether, while others who still offer it are a charging  monthly premium for this service.  The premium can range up to $10 a month. This is necessary because, the insurance companies say, because there is a greater cost to them in leaving a "paper trail" rather than processing the payments through a bank.

A bank draft is relatively easy to set up. Usually it just entails filling out a form with the account number and the routing number for the account and sending it into the insurance company.  If it is necessary to stop the payment because the coverage is being canceled, the carriers  are prompt in taking the action as long as they are notified before the draft date.

If you are not currently on an automatic bank draft, we recommend that you look into it as a time saver and something that will lead to greater "peace of mind." in keeping your coverage in effect.