Misconception 1: Health insurance is unaffordable:

There are many types of plans available. The Health Savings Account (HSA), & the traditional copay type plans are the most popular. How do they compare?

The HSA plan is a high deductible health plan that covers you if there be a catastrophic health related event. It doesn’t cover the day to day incidentals like buying drugs or visiting the doctor. Therefore, these plans tend to be more affordable and the premiums are more stable from year to year. If you purchase a very high deductible plan, you will limit your financial exposure.

The copay type plan offers some advantages over the HSA plan. First, you will have a copay of typically $30 to $50 to see a doctor. This makes it easy to see a doctor without causing a large hit to the monthly budget. The fallacy is that to offer you a copay, the insurance company has to estimate how many times you will visit the doctor.

If they insure a family that sees a doctor very frequently, such as once or twice per month, the insurance company will lose money because they have to make up the difference between the amount of the copay and the actual amount of the service provided. They don’t like to lose money, so they build in a cushion. They assume that you will use your insurance frequently, and make the monthly premium high enough to cover this eventuality. Consequently, copay plans are NOT the least expensive way to insure yourself — especially if you only see a doctor only once or twice per year.

To make insurance affordable, purchase a very high deductible HSA plan. It will offer you catastrophic coverage for an affordable price.

Misconception 2: I don’t have much to lose:

You have a house, a nice new truck, a relatively new car, but you don’t have health insurance. It is just a matter of priorities. Drive older vehicles, and you can then afford health insurance. Why, you say? If I have to go the hospital, they will take care of me and they will offer me a payment plan. The fallacy here is hospital admittance. The hospitals DO NOT have to admit you unless it is an emergency. If you need a hysterectomy, don’t expect that the hospital will admit you.

Payment plans offered by hospitals and doctors may work for you, but what if you need a very expensive procedure like bypass surgery? That will cost approximately $130,000. Do you want to have to make payments monthly for the next twenty years? How can you expect to ever be financially sound with that burden to carry?

How about bankruptcy? That is not an option any longer. The courts have decided that medical payments cannot be forgiven through bankruptcy.

You do have a lot to lose. Lose your assets, incur a long term debt and perhaps be denied admittance to a health care facility.

Misconception 3: All or nothing thinking:

If you cannot afford a Cadillac, shouldn’t you buy an inexpensive Ford, Chevy or even a Yugo? Yes, you need protection from financial ruin. Consider a $10,000 deductible plan. Oh, you gasp, that isn’t very good. Where would I get $10,000? Ok, then, what is your deductible if you don’t have any health plan? It seems to me that your deductible is UNLIMITED! Just about productive person can pay off $10,000 over a period of time. However, it is much more difficult to pay off $100,000, $200,000 or more.

There is a widespread misunderstanding of insurance concept. Insurance is not supposed to cover the “little stuff” It should cover the big events that you cannot recover from. There is a 1 in 1200 chance that you will lose your house to fire or weather events. You probably have your house insured because you couldn’t afford to lose your house.

There is a 1 in 30 chance that you will be hospitalized. As you can see, the chance that you will need health insurance is much greater. Don’t be imprudent, protect yourself.

Summary:

Health Savings Account (HSA) type plans are more affordable. Purchase HSA plans instead of copay plans. If you go without a health plan, you may incur expenses that you will hinder your future. You may not gain admittance to get the health care that you need. You cannot use bankruptcy to relieve medical expenses. A high deductible plan provides a limit to your out of pocket expenses. There is almost no limit to your expenses if you don’t have a health lan in force.

By: Richard Day

The day comes that you lose your job and, along with it, you lose your health insurance. Fortunately, interim health insurance is something that can keep you afloat until you find a new job. An interim health insurance policy will cover your health care needs from the time you lose your job until you are eligible for benefits from your new employer.

Where should you begin to look for a short-term health insurance policy? Like many people today, your first stop will probably be one of the internet search engines and these will produced a laundry list of directories. These directories each provided a list of companies that offer interim health insurance and even a few that will actually tell you exactly what it is. Knowing what interim health insurance is and, just as importantly, what it is not will help you shop for the right policy and keep you from being scammed.

First of all, each state has its own brand of interim health insurance policy to help you hold onto the health insurance from your previous employer. In Minnesota it is called a Cobra Plan and covers you until you have a new job. Incidentally, state law also requires your employer to notify you of your eligibility for Cobra coverage.

Commercially available interim health insurance policies generally run from one to twelve months, although many providers limit their policies to six months, and will offer most of the same benefits that are provided on their long-term counterparts. The biggest difference you will see is that the policy is non-renewable and if you want to keep your coverage you will need to arrange a further new policy. Keep in mind that this type of policy is only intended for short-term use and not for long-term use.

Some things that will probably not be covered are wellness checks and preventative care. They will also not normally provide cover for dental or optical care. They are also very strict on denying coverage for pre-existing conditions. You can get coverage extended to cover your spouse and children. You will find also that most policies will range in price from around $25 to $100 per month.

Keeping these things in mind, you can begin to look through the results of your search. Examine the lists of companies and find one that will meet your needs. Another good place to turn for cover, because of the fee-for-service nature of the policy, is to your own home or car insurance provider as it is likely that they will also carry a health insurance policy that you can get. If you are purchasing the policy through your own insurance company, there may be an additional discount available to you for having multiple policies with them.

Your local phone book may also list a number of places for you to get interim health insurance coverage in your area. This can be an advantage if pre-approvals are needed. With a knowledge of what interim health insurance is and where you can find it, you will now be able to secure a policy that will best meet your needs.

By: Donald Saunders