According to a 2003 study by the Census Bureau of the United States:
- More than 84 percent of Americans have health insurance coverage.
- Slightly more than 60 percent are covered by private health insurance based on employment.
- 9 percent buy private insurance on their own.
- Approximately 26 percent is covered by an insurance plan sponsored by the government, such as Medicare, Medicaid or insurance for military.
- More than 15 percent, meaning that 45 million people have no coverage whatsoever.
If you’re young and healthy, you might feel tempted to “save money” by not buying health insurance. A general rule for the smart money management is not something you can never ensure pay for your account. But with the high cost of medical care today, to stay healthy needs a strategy that can have serious financial consequences. Maybe you can handle the expense of minor health problems, but a serious illness can financially ruin you and your family.
Basic Insurance Terminology
- When you purchase insurance, you receive an insurance policy, ie, a document that spells out exactly what is covered and what is not.
- The elements covered by your insurance is called your benefits.
- The amount you pay for insurance is called the premium.
- When you have medical costs and send the bills to your insurance company, this is called a complaint.
- Typically, your insurance company will only pay a portion of your medical costs. The portion of a claim you have to pay before the company will cover the rest is called the deductible, the amount you pay for each medical bill is called the co-payment.
- The value of insurance is to protect you from major expenses that you are unable to pay. As a rule, the higher the deductible, the less expensive the insurance premium. Therefore, a good strategy is to obtain a policy with the highest deductible you could comfortably afford if you had to. This will minimize the cost of your policy.
Here are some tips to ensure you have adequate health insurance:
1. If you are currently covered by the insurance policy of your parents, see how long you can continue coverage under your policy.
2. If you are still in school and you are covered by student insurance plan, find out what coverage is available once you graduate.
3. If you do not have insurance, do a little research. Check the Internet for information on methods of personal health insurance and how much they cost. You might be surprised to see that, for a monthly amount available, you can get insurance that will cover you in case you have large medical expenses.
4. Note that other factors can significantly affect the price of insurance, including the state in which you live. Some states allow insurers to charge higher for people who have health problems. Other states require insurers to charge the same to all people, regardless of age or health status.
5. If you anticipate that you will have coverage at work within the next 6 months to a year, looking for short-term plans that are available.
6. If you are currently working, fail the insurance plan offered by your employer, if offered. Normally you pay part of the cost thereof and the amount you usually deduct from your paycheck.
7. If you are covered by health insurance at work:
- Check the manual or employee benefits, provided by your company.
- or You need to understand what the policy covers. You have to know what are the limits and deductibles. Do not expect to find when you need to file a claim.
- or you have to understand what factors might affect your eligibility. For example, you have to maintain a certain number of hours to remain eligible? What happens if you go to work full time to working part time?
8. If your company makes a change in your health plan:
- or be affected Find out how your health insurance coverage.
- Make sure of your doctor that you remain on the list of approved suppliers.
- or determine if any of the amounts you have to pay has changed.
9. If you change jobs, lose your job or leave a job to go back to school, determine what you can do to maintain health insurance coverage.
10. If you’re married, see if you can get coverage policy your employee spouse.
11. If you work on your own and are not eligible for coverage through an employer, remember that you can deduct 100% of your premiums health insurance in your tax returns.
Before buying health insurance, see the “financial strength rating” from the insurance company. This rating is a measure of its financial strength and the ability to meet the demands of its customers. The highest rating is AAA, followed by AA. Avoid companies that do not have a rating of at least “A”.
About Health Savings Accounts (Health Savings Accounts or HSA)
One way to save money on medical expenses is to open a health savings account (HSA). To qualify, you must be under 65 and have a health insurance policy with a deductible of qualified at least $ 1,000 for individuals or $ 2,000 for families, and meet certain other requirements. With an HSA, you can set aside money before taxes to the amount of the deductible, within an annual maximum. Then you can withdraw your savings tax-free health care to pay for medical expenses. Your money is not insured by the FDIC, but is placed in investments which have the potential to grow over time. The money you do not use in a year can continue to grow tax-free until you withdraw. Request details to your financial institution.
What if I change jobs?
If you leave your job, a federal law called the Consolidated Omnibus Budget Reconciliation Act (COBRA) requires employers with 20 or more employees to continue coverage will provide health insurance for a period of up to 18 months. You are responsible for paying the entire premium, plus up to 2% administrative charges.
If you’ve only been paying part of the cost of your insurance, suddenly having to pay the entire premium you may have important consequences for your budget.
If you go from one company to another, and both companies offer group insurance plans, there is no guarantee that you have exactly the same coverage – benefits, premiums, or deductibles-in your new job. However, a federal law called the Health Insurance Portability and Accountability Act of 1996 (HIPAA) can help you avoid losing benefits you already have. Note that HIPAA provides little protection if you change a group health plan to an individual plan, or do not have insurance.
Under the provisions of HIPAA:
If you change jobs or lose a job, HIPAA guarantees renewability and availability of health coverage to certain employees and individuals and limits exclusions for health insurance because of preexisting medical conditions. The group health plans can not deny your application based solely on your health. They can not deny your coverage for mental health reasons, genetic information, disability or prior claims.
Your new health plan must crediting the time you were enrolled in your previous plan. For example, if you were covered by your former employer’s plan for 12 months, a new plan must have the time to meet their own eligibility requirements.