4 Health Insurance Blunders To AvoidTuesday, October 18th, 2011 by admin
To have the best life, it's essential to plan. Sometimes a plan for the future has to be developed; sometimes one for the present; and occasionally, a plan for both. Health insurance coverage is one area where a plan for the present and future is needed. At best, this is difficult. At worst, mistakes happen and one of several health insurance blunders is made with possibly serious consequences. Here are four common health insurance blunders to avoid:
Going Without Health Insurance
When you are healthy and young, it's easy to become convinced that the financial sacrifice necessary to budget for health insurance coverage is not the best use of your funds. However, needing access to medical facilities is only an accident or illness away. Young adults are more prone to risky behaviors such as speeding or substance abuse and, of course, health conditions requiring expensive, extensive treatment know no age boundaries. Not having coverage is the costliest blunder.
Skimping on Maximum Benefits Coverage
Even those who feel coverage is essential make mistakes in an effort to economize. Thinking they are getting the most for their money, the reverse may be true. Some policies look like good deals because they have low premiums and deductibles. Usually, however, that's accompanied by low maximum benefits to be paid. A cap of $50,000 or $100,000 per illness or accident can devastate a budget and leave a person with several thousands of dollars in uncovered out-of-pocket expenses. After the cap has been reached, the individual is 100 percent liable for the expenses that exceed it. One good way to lower premiums is with a high-deductible policy that has a coverage limit of $1 million or more.
Focusing on the Deductible
Low deductible plans sound great, but it's easy to end up overpaying for them. Plans with low deductibles are enticing; the issue is whether the difference in premiums is justified by the difference in benefits. For example, if Policy A has a $1000 annual deductible and costs $300 a month, its total yearly cost is between $3600 and $4600. If Policy B, however, has a $2500 deductible and costs $100 a month, its yearly cost is between $1200 and $3700. A policy holder possibly gains $2400 by purchasing Policy B.
Not Understanding the Terms
Simply reading the policy before buying coverage can avoid not having the coverage you thought you did. Know the benefits and exclusions. Is your doctor part of that plan? Are the medicines you take covered?
People who are alert to common coverage blunders can avoid them by doing comparison shopping on the Internet. Agents can also answer questions, explain policies and help with policy selection.