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The Real Cost of Health Insurance

by: Ron King

Do you know the actual cost of your health insurance?

Everyone knows that health insurance costs are continually rising, but how do these spiraling costs affect your health insurance coverage? You know how much you pay every month for your health insurance premium, so it’s easy to know when this cost goes up. But what about all the other costs involved with health insurance?

Before you’re hit with an unexpectedly large medical bill, find out about the hidden costs of your health insurance.

The Premium

The premium is the amount you’ll pay for the benefits covered under your health insurance plan. The premium is typically broken down into equal monthly payments. If you’ve got group insurance, your employer or union is probably sharing some percentage of this cost.

The Deductible

If your health insurance policy includes an annual deductible, you need to understand the details. A deductible is an amount you are responsible for paying before the insurance company begins paying out claims. As with car insurance, the higher your deductible, the lower your monthly premium and vice versa. A family health insurance plan typically includes multiple deductibles, one for each family member.

The Co-Payment

A co-payment is a fixed amount you have to pay each time you visit the doctor. The co-payment amount will depend on the type of health plan you have. Typically, an HMO will have the lowest co-payment. The co-payment can increase, however, for different types of medical service or if you visit a doctor or hospital outside the network.

Co-Insurance

Co-Insurance is the amount of a claim that the insured is responsible for paying, once the deductible has been met. A typical ratio is 80/20, where the insurance company pays 80% of a claim and the insured pays 20%. An insured’s percentage will usually increase when he or she goes outside the network. Also when the claim exceeds what the insurance company deems “reasonable and customary,” the difference is another form of co-insurance that you must pay.

Comparing Quotes

Make sure you fully understand these health insurance costs. Ask about them when requesting quotes, especially online health insurance quotes. When comparing quotes from different insurance companies, it’s essential to know all your costs, not just the premium. Make sure the person preparing your quote clearly defines the deductible amount and whether there are separate deductibles for different types of services, the co-payment amount and the co-insurance amounts. Also, ask the rep to describe any other costs that may not be readily apparent.

Holding Down Your Costs

There are a number of ways you can help control costs once you have selected a health insurance plan. If yours is a “managed care plan,” be sure to stay within your network. If you can choose any medical care professional, be sure that the provider’s fees for the services you’ll need fall within your insurance company’s “reasonable and customary” guidelines. If not, shop around for a less expensive provider.

Other tips for keeping health insurance costs at a minimum include choosing a healthier lifestyle and seeking medical care only when absolutely necessary. After that health care costs are largely beyond the individual’s control. The best medical advice would be, don’t get an ulcer worrying about them.

Ron King is a full-time researcher, writer, and web developer. Visit healthinsuring to learn more about this subject.

Copyright 2005 Ron King.

 

 

How To Choose A Health Insurance Plan
by: Ron King

Are you thinking about buying health insurance? With so many different alternatives, it is difficult to know which to choose.

When choosing a health insurance plan, never base your decision solely on the monthly premium. There are many other cost factors — deductibles, co-payments, and the like — that will determine the true price tag of your insurance. You’ll need to read the fine print of the health insurance plan, including what it does and does not cover, the in-network versus out-of-network coverage and costs, claims processing procedures, and the coverage limits.

Know Your Health Care Needs

The first step is to review the scope of your needs: coverage just for yourself, for a large family, or something in between?

Next assess the health needs for all you intend to include in your health insurance plan. Are there any pre-existing conditions to consider? Does someone need to have access to certain medical specialists or medical institutions?

Research and Compare Your Options

The answers to the above questions will give you a good starting point in your search for the right health insurance plan.

Next, you need to explore your options. If you’re getting group insurance through your employer, your options will be limited to what the company offers. Otherwise, you’ll need to more research and comparison shopping. At a minimum, you have to understand the difference between the 2 basic types of health insurance plans offered today: the Indemnity Plan, and the Managed Care Plan with its variants.

Indemnity Plans and Managed Care

An Indemnity Plan offers the freedom to choose when and where you will seek medical assistance. Along with this freedom usually comes higher out-of-pocket costs. For many this is a fair trade-off.

Managed Care Plans are more restrictive, and require you to utilize the medical professionals and institutions that are part of the plan’s “network.” Participants often need pre-approval for medical services that are beyond basic preventive care. The costs for this type of plan are usually lower than Indemnity Plans. For those who are basically healthy, don’t mind who provides their medical services, and who need to control medical costs, Managed Care Plans are usually the better choice.

This is a very basic comparison of the types of health insurance plans available. It is a first step in your own data gathering and analysis process.

Select The Right Company

Once you’ve done your homework and know what you want, you need to choose the right health insurance company. Many companies offer health insurance, from well-known corporate giants to small independent outlets. As with any major purchase, you’ll want to research these companies before making a final decision.

Also, find out which state or federal agency regulates the type of health insurance you’re considering, in case you have questions or experience problems.

Each type of health care plan has advantages and disadvantages. It is in your best interest to research thoroughly, so that the health plan you choose will be the right one for you and your family. For today and for years to come.

Ron King is a full-time researcher, writer, and web developer. Visit healthinsuring to learn more about this subject.

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