What are the pros and cons of private health insurance?
Some of the pros of private health insurance include a variety of plan options and companies. The cons include expensive health insurance premiums and limited coverage. Health insurance is one of those necessary evils. No one wants to pay the premiums, but it is invaluable if you ever need it.
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When it comes to health insurance there are a lot of options. These include group health insurance plans, private plans, and plans run by the government. Each has their own benefits and negative traits. In regards to private insurance, in general it has more cons than a group policy.
Private Insurance Overview
Who is private health insurance for? Private individual health insurance is generally for individuals who are unable to get a group policy or do not quality for government sponsored plans. Since most group plans are available through employers, you would need to get self-employed health insurance coverage if you work for yourself. You also would want to look for private plans if you work part-time, are unemployed, are a student, or work for a smaller company that doesn’t offer insurance coverage.
With private health insurance, you can choose from a plethora of plans and companies to find the best one for you.
Even if you fall into one of those categories, you should explore your health insurance options. See if there is a way to be added to someone else’s policy or get group health insurance in another way. Some professional organizations are big enough in that they are able to offer group plans at a more affordable rate than you would pay individually.
If you under the age of 26 and are not married, you probably are still eligible to be added to your parents’ health insurance plan. If you are married you may be able to be added to your spouse’s health insurance.
Benefits of Private Health Insurance
What are the benefits of private health insurance? The biggest benefits of private health insurance are related to selection and choice. If you go through group health insurance, you often only have one or two plans to choose from. You also have the freedom to choose your deductible amounts and, in some cases, your health insurance copayments or coinsurance amount.
With individual insurance, you can choose a basic plan or a more comprehensive one, depending on your budget and medical needs. You can also add on certain riders or services such as dental and vision. To see the variety of insurance plans you can choose from, visit the Insurance Information Institute.
As part of your options, you can choose a plan that includes coverage for the physician of your choice, whether they are in network or not. You also will continue to be covered as long as you pay your premiums on time. This is not the case with group insurance, in which if you change or lose jobs, you lose your insurance coverage as well.
Private Health Insurance Negatives
What are the negatives to private health insurance? Along with the positive aspects of private health insurance, there are drawbacks as well. The biggest negative is expense. Even for healthy young individuals, premiums for private insurance have gone through the roof in the last few years. For those people who are older or in poor health, premiums are very high. Insuring your entire family with private insurance is extremely expensive.
Another downfall to private health insurance is the fact that individuals with preexisting conditions are either denied complete coverage or have exclusions in their policy.
Some individuals will lower their health insurance premiums by increasing their deductibles. Although this may lower the cost on a monthly basis, if you had an emergency or a major health issue, you would have to pay the entire deductible before your coverage began.
With group health insurance plans, a condition that has been there before is usually not a factor in acceptance. In private health insurance plans, even if you are accepted for coverage, if you have health issues your premium will be a lot higher.
Health insurance rules vary from state to state. Because of this, premiums and coverage regulations may be different if you move. To find out what the laws and regulations are in your state, click on the map of the National Association of Insurance Commissioners. They can also help answer other insurance questions that you may have.
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