Which Kind of Individual Health Insurance Should You Buy?
Do You Need To Buy Individual Health Insurance?
If you need to purchase your own individual or family major medical plan it can seem intimidating. You will probably find yourself learning about lots of new new things like deductibles, copays, and yearly maximums. But if you take a few minutes to educate yourself about the types of plans on the market, it can make your search much easier. Remember, there is not one best individual health insurance plan, but there may be a best plan for you and your family!
Preferred Provider Organizations
Preferred Provider Organizations (PPO) are popular today. People like them because they are fairly simple to use, but also allow some flexibility.
When you join a PPO plan, you will get a list of network providers. You can find different types of doctors, therapists, etc. on the list. To get the best coverage, you must use these network providers. However, you are free to leave the network and still be covered, but at a lower level. This allows plan members the freedom to choose between paying less in the network or paying more outside the network..
There are usually some exceptions to the network rules. These exceptions include urgent medical needs and care that is not provided by the network. If you need care outside of the network, but it is not an emergency, always be sure to get it approved before your appointment. You will have to read your individual policy, or get it explained to you by an agent, for the exact details.
Heath Savings Accounts and High Deductible Major Medical
A new type of health plan comes with two parts. One part is a health savings account (HSA). Deposits into this account are tax deductible up to IRS limits. You can use the account to pay for medical expenses. Any money you do not use will roll over from year to year. If there is any money left in the account at retirement, you can withdraw it with no penalty.
The second part of the plan is a high deductible health insurance plan. Because the deductible is fairly high, premiums should be kept in check and underwriting rules may be more lax.
The idea behind this plan is that you can control your costs and save money. You can save money on taxes because contributions to the HSA are tax deductible. You can use the money in this account to pay for many different medical expenses, and this includes some that are not covered under major medical plans. You can also save money because higher deductible plans are cheaper than lower deductible plans.
These types of plans only work well for disciplined savers though. People who do not save money to fund their HSA account will not be happy with the plan when they do need to get medical services. If they have to pay for services from their checking account because there is no money in the HSA, they will not get the tax benefits.
Which Individual Health Insurance Should You Buy?
It is important to compare plans in your area. Then decide which one will work best with your lifestyle, family situation, and budget. That way you can find the best plan for you!