Trying to determine which health insurance company is the best is a task undertaken by countless numbers of people every year. It’s not uncommon for the annual health insurance enrollment period to come around only to find your fellow workers just as confused by all the options as you are. This is a time when you need as much help and practical advice as you can get your hands on.
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The first thing to remember in making this choice is that it’s more important to determine the best plan rather than the best health insurance companies. That is primarily for two reasons. First and foremost, it may be that your employer only offers insurance plans from a specific company, making choice of company a moot point. Second, even in cases where you have the option to choose between multiple companies, it is the plan details that count.
How important is the price?
Indeed, price plays a big part when choosing health insurance. However, keep in mind that price isn’t everything. You also have to consider things like coverage limits and how the health insurance deductible is calculated. It can be difficult to compare health plans due to their complex nature but the only way to know for sure if you’re getting a good deal for your money is to do a thorough comparison.
Consider that you may have an option which presents a very inexpensive monthly premium but is a high deductible health insurance policy. If you should ever have to avail yourself of costly medical services the deductible could end up costing you more than you would have paid if your policy had a higher health insurance premium. When looking at cost be sure to find out what you’re getting for your dollar.
How do health insurers determine my price?
Determining how much an individual will pay for health insurance is a process known as underwriting. California’s Department of Managed Health Care explains underwriting as a process in which the insurance company looks at your age, sex, lifestyle choices, and overall health history in determining how much it will cost to cover you. When they do finally render a premium they must have statistical data to back up their conclusions.
In terms of a group policy offered by an employer, the individual underwriting is then thrown into the larger pool of all group members for the purposes of fine tuning your premium. As an example, you may have a low incidence of cancer in your family while the group you belong to has an unusually high rate of incidence. The statistics will favor the group over you, causing a slight increase in your premium to cover the cancer risk.
Are all health insurance companies the same?
Choosing health insurance plans based on the companies offering them is a very tricky situation. By comparison, auto or homeowners insurance companies have a lot more latitude in crafting their policies. The result is greater variation when comparing one policy with the next.
Health insurance, on the other hand, is so tightly regulated at both the federal and state level that there is very little difference between the health plans offered by different companies. While all health insurance providers are not technically the same, the differences between them will be largely in terms of customer service only. Most of their plans are going to be similar; the one exception to this rule is major medical coverage.
What is major medical coverage?
The Merriam Webster Online Dictionary defines major medical coverage as “insurance designed to pay all or part of the medical bills of major illnesses usually after deduction of a fixed initial sum.” Simply put, it is designed to cover you in the event of major things like heart attacks, serious traffic accidents, and cancer treatments. Unlike HMO health insurance companies, it does not cover routine doctor visits and vaccinations.
When you’re trying to determine what health insurance company is best for you it simply comes down to comparing one plan with another. This is a long and tedious process which can be confusing if you’re not familiar with how health insurance works. Be sure to ask your employer or health insurance provider any health insurance questions you have before agreeing to a policy.
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