There are different types of private health insurance to choose from when you’re shopping for the best coverage. Health insurance is important to United States citizens. No one wants to pay out of pocket for medical expenses should something happen and most can’t afford to! This makes health insurance critical.
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The price of private health insurance is a burden and the rate of growth has slowed since the early 2000s. However, Kaiser Education explains that the cost of health insurance will eventually exceed the national income in the future because of the rise in health care.
Why is the cost of health care increasing?
The costs of health care are increasing for several reasons. Prescription drugs and the use of medical technologies are always advancing which fuels health care spending. The increase in demand and develop to aid in medication and technological usage will push these costs higher every year.
The overhead costs of administrative assistance, taxes, profits and losses is another driving force in the increase costs of medical care. With the future of mixed public sector and private sector insurance, the overhead costs of administrative work are expected to go through the roof.
Finding the best private health care insurance can help with the increase in medical costs.
The baby boomers are reaching retirement age and with that the need for medical care is increasing as well. Longer life spans and a greater prevalence of chronic illness is putting pressure on the health care systems to carry more coverage. Obesity and diabetes are other driving factors in the need for increased benefits in private health insurance plans.
What types are available?
According to the U.S. Census Bureau there are three types of private health insurance coverage. Employment based health insurance, direct purchase health insurance and own employment based health insurance.
Employment based health insurance offers coverage through independent employment or that of a relative. It may also be offered by a union or employer. Direct purchase health insurance is coverage through a policy that was purchased by a single person through a private health insurance company.
Own employment based health insurance is when only the policyholder is covered by the plan. The policyholder applied for their own private health insurance because of self-employment.
Managed health insurance plans are extremely popular as well. There are three that are commonly used which are HMO, PPO and POS plans. HMO health insurance plans are also called health maintenance organization plans and have a specific network of preferred professionals for customers to work from.
PPO health insurance plans are also known as preferred provider organization plans. These plans are much like HMO plans with a set network of providers; however, with these plans you need to have a primary care physician to coordinate care.
POS or point of service plans are more flexible with their network of providers than POS and HMO plans. You can choose a doctor or specialist outside of the plans network, however, you’ll usually have to pay a percentage of the costs and the deductibles and copayment can be more expensive.
What should I look for?
Most people look at the premium rates first and foremost. However, it’s just as important to read the fine print of any policy beforehand as well. While a premium rate might seem lower than its competitors, there’s a good chance that there are gaps in the policy that are made easy to overlook.
Make sure you check to see if there are any exclusions or restrictions in the health insurance policy. While this isn’t the case in all states, there are some states that don’t require health insurance companies to include the cost of maternity services. This can be a huge gap in your insurance policy if you have a baby on the way.
In most cases if your premium is low and your coverage contains little to no gaps, your deductible and copayments will most likely be high. Health insurance companies have to make up for the difference. High deductible health insurance policies will have low premiums.
It’s also a good idea to see if the policy has a lifetime maximum. If this is the case you should only look at plans where the lifetime maximum is one million dollars or more; don’t settle for anything lower. A lifetime maximum is the amount a health insurance will pay over the life of the policy.
Finding the best in health insurance rates doesn’t have to be hard- just enter your ZIP code in the FREE health insurance quote tool and get started today!