Health Insurance
It would be nice if someone could insure that you will
remain healthy, as the terminology "health insurance"
implies. However, with new epidemics popping up all over
the globe, and injuries lurking around the corner of our
daily lives, someone came up with the next best thing,
a way to help people pay for the treatments necessary
to restore one's health.
It might surprise you how many people are without health
insurance. The question is, are you one of them? And,
should you be one? Take a look at some of the issues surrounding
health insurance as well as the benefits and how it works.
Should You have Health Insurance?
Many factors usually go into a person deciding if they
need health insurance. Unless you are one of the few people
to have an over abundance of money, then it is recommended
that you have some form of health insurance. Because the
day of disaster is known to no man, one should always
be prepared for some things.
Physical maladies should be at the top of the list. Being
ill can affect your income and can lead to permanent damage.
If you spend money on maintaining your car, you should
invest in your own body. Health insurance should not just
be used as an emergency ticket but also as a maintenance
plan.
You should see doctors regularly to detect early signs
of illness so you can take the necessary precautions to
preserve your health. Keeping this in mind the monthly
investment required for health insurance will pay for
itself with your good health.
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How does Health Insurance Work?
Health insurance comes in different forms but they all
basically have the same motive; to help people save money
long term on healthcare and make a profit doing it. There
is a common misunderstanding with the way insurance companies
actually work. Some people believe that the money they
pay goes into a pot that can pull out when they need it.
While this basic concept holds some truth, there is more
to it. Think of an insurance company as more of a mutual
fund. From the members perspective they are putting money
in for a rainy day and discounted medical treatment.
From the insurance company's point of view, members are
investors. They take the accumulated member dues and invest
them in investments funds of their choice. Here is where
it is different from a mutual fund; only the insurance
company earns money from the investments.
The good news is, the more money an insurance company
has, the better it is able to assist its members in saving
on premiums, deductibles, co-pays and paying out claims.
It is a numbers game that requires a lot of careful financial
planning.
These insurance companies use averages to determine the
number of their members that will actually make claims
and spend more than they invest. Over a large sum of members,
it averages out that their income will out-weigh their
claims. But this should not affect your choice to get
heath insurance.
Popular Health Insurance types
Preferred Provider Organizations (PPO) and Health Maintenance
Organization (HMO) are the most common insurance types
available. These two types programs have very different
approaches to health care insurance and should be selected
based on your needs.
HMO VS PPO
There are several differences between HMO and PPO insurance
programs. The way the programs are structured is one
of these differences. HMO insurance programs are run
by private insurance companies that have a group of
doctors in their network.
PPO insurance programs on the other hand are usually
a group of doctors and hospitals under an umbrella that
work together to offer its members discounted medical
treatment. Another major difference between these two
programs is the cost of protection.
Generally speaking, HMO insurance programs are less
expensive than PPO programs. The primary reason is because
HMO insurance programs have fixed costs for most procedures,
in comparison to the percentage structure of most PPO
programs.
There are however certain instances, where if not
used correctly, an HMO plan can become very costly.
It very important that you become familiar with the
rules of your HMO. Another difference that factors into
your choice of protection is the method in which payments
are made for your medical care.
HMO insurance programs usually require a co-payment
for general preventative care and doctor visits. These
services usually cost anywhere from $0-$25 in most cases.
Many PPO insurance programs offer this to its participants
but many require full payment of services up front.
If payments are made up front the PPO member is reimbursed
the pre-determined percentage of the charges incurred.
So in general a PPO member needs to fanancially capable
of paying for their services up front.
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Specialty coverage
Some health insurance companies offer specialty coverage.
Getting covered is strictly at your discretion. Specialty
coverage programs are designed to assist people who are
afflicted with debilitating illnesses like Cancer.
These types of illnesses usually are a large financial
burden on families and can lead loss of income and property.
Most of these specialty coverage programs are designed
to cover the losses resulting from such an illness.
Should you get a specialty coverage?
The reasoning behind this should be based on calculated
risks. If there is a high possibilty of you being diagnosed
with a debilitating illness based on your family's medical
history or other outside factors, then maybe it is a
good choice.
The truth of the matter is, you never know what the
future holds for you. If the piece of mind you receive
from attaining such protection is valuable enough to
justify the premiums, then this type of program is for
you.
So use your discretion, do your research, and make
the choice you feel the most comfortable with.
Read the fine print
Be sure to discuss the terms of your premium. It is important
to know what factors affect your rates. Some HMO insurance
providers rates go up with a person's age or if a person
is stricken with an illness that requires a lot of costly
treatment. These are things you should know before it
is too late.
Use Your Health Insurance
The most important thing to remember, is to use your
program. Don't wait for symptoms to become evident before
you see a doctor. Visit a specialist of each type at least
once a year. The truth is most general practitioners are
not always thorough in their examinations.
A specialist is trained to look for certain symptoms
that are treated in their field of medicine. An example
of a good specialist to see is a dermatologist. With the
increasing effects of the sun's damaging rays, it is important
that you have a dermatologist inspect your skin for signs
of melanoma and other potential problems.
Health Insurance type requirements
HMO
Requirements
PPO
Requirements
State Health Insurance Regulations
The government has set in place certain restrictions to protect
consumer rights. To find out what state regulations are
in place to help protect you from insurance fraud and
what you should be aware of when choosing a health insurance
provider, click your state link.
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