Knowing the Basics of Health Insurance
Educating yourself on the ins and outs of health insurance is essential to understanding it. Many people find the details to be confusing to say the least. If you stick to these 7 basics you will succeed in understanding health insurance. This will allow you to make wise decisions and educated choices while finding individual health insurance.
The first basic detail in health insurance is the Life Time limit they set, or the Lifetime Maximum. If you should have a critical illness such as cancer and extra $2million is a major benefit not to be overlooked. If your Lifetime Maximum is $3million, that is the most it shall ever payout.
Deductible is important basic knowledge when it comes to health insurance. The lower your deductible amount the more you can expect to pay in premium. The deductible must be met by the consumer before the insurance company agrees to share the cost.
After meeting your set deductible you may the start paying a percentage of your occurred medical expenses. This is what insurance companies refer to as co insurance. You may have a 70/30 plan with a maximum of $2000. So the insurer would cover 70% while you cover 30% until the maximum was met, at which time the insurer would pay 100% for the remainder of the year.
Another often misunderstood part of insurance is Co Pays. If your plan has built in Co pays for Office Visits you pay only the co pay amount even if you have not met your deductible or co insurance. There are some exceptions, if not noted in the plan as included in office visit you would still have to pay lab and x-rays.
Many insurance plans include what is called a Preventative exam. As a general rule the benefit allows one preventative exam a year. One thing that baffles consumers when they get an unexpected bill is the limits. Many have a maximum pay out. So if you went for an exam and the expense was $500 and the insurer pays a maximum of $300 you should expect a bill for the remaining balance.
One basic that is detailed in clear is the limitations. These are sometimes overwhelming to consumers and overlooked. But you need to take the time to know the limitations. They may restrict how much the pay for certain illnesses or treatments. They may only pay for 2 office visits a year.
Some catastrophic plans do not cover prescriptions. It is crucial that you understand this. On the more benefit rich plans you can expect to pay a co pay for you prescription. But take notice if you have a maximum the carrier will pay, some prescriptions can be very costly.
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Written by Jeff Cline on December 9th, 2009 with
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