Did you know medical bills are the leading cause of bankruptcies in the U.S.? In 2019, 61 percent of all bankruptcies were tied to medical debt.
As a financially-savvy adult, you know that purchasing health insurance is an effective way to avoid falling into medical debt. An emergency room visit will cost you, on average, $2,200 every day. Without any coverage, you’ll pay for your expenses out of pocket.
However, health insurance plans aren’t created equal. Read on for a guide to important things to consider when choosing a health insurance plan.
1. Type of Health Insurance Plan
There are different types of health insurance plans you’ll find in the market.
On a broad level, there is private health insurance and public health insurance. Private health plans are offered by private carriers, but the plans can also include government-subsidized plans like Obamacare. Medicare and Medicaid are examples of public health insurance plans.
Under private health plans, there’s are sub-types:
- Managed care plans – The insurer has a network of healthcare providers that policyholders must use
- Indemnity plans – Policyholders are free to get services at providers of their choice
- Preferred provider organization plan – Works like indemnity plans, but policyholders will get better rates if they visit the insurer’s preferred providers.
- Health maintenance organization plan – Policyholders have to get care from doctors that work for the organization, but there could be exceptions during emergencies.
With this information, you can now choose a health plan that best suits your specific needs. In most cases, though, it’s advisable to get a plan that enables you to access services from a wide range of providers. This way, even if you’re traveling you can still get a provider who accepts your insurance.
A premium is the cost of health insurance. Premiums vary depending on the type of health plan, your age and health status, the level of coverage, and the insurance company.
While it’s incredibly important to have health insurance, you don’t want it to cost you an arm and a leg. Shopping around extensively will help you compare multiple quotes and improve your chances of getting the best deal. Insurance agencies like The Insurance Stuff can help you get the best offers.
3. Deductibles, Copays, and Coinsurance
A deductible is an amount of money you must pay before your health insurance kicks in. Coinsurance is your share of the cost of getting a healthcare service, and copay is a fixed amount a policyholder must pay for a certain service.
Not all health insurance policies have these costs, and among the plans that have them, the figures vary.
Therefore, it’s your responsibility to read through the lines and know what you’re signing up for. You don’t want to be caught unawares when you visit a doctor expecting your insurance to cater for everything only to be asked to take care of some of the expenses.
The Major Things to Consider When Choosing a Health Insurance Plan
You’ve made a smart financial decision to get health coverage. However, you have to buy a plan that works for your needs. With this guide on the things to consider when choosing a health insurance plan, you’re now in a better position to make an informed decision.
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