Health Insurance -Need or Necessity

A Health Care Article Contributed by Indra Chopra

Health Insurance

Health insurance has been one area that till now had been relegated to "must-take-a-look-sometime" agenda. Today with rising health care costs we cannot afford to be laid-back in our approach. Health insurance is similar to any other insurance coverage. It is to protect our selves and our families from expensive medical care in case of major illnesses or accident. By taking health insurance we make a third party pay our medical bills. The third party can be an insurance company or an employer.

Health Insurance Plans

There are different types of health insurance plans each with its plus points. The way to differentiate between them is to see which best suits our requirements. A plan that is good for someone else may not work for you and vice versa. For example if there are two adults it will work out cheaper to have two individual plans than a family plan. But if there are children or planning to start a family it is advisable to go in for family plan.

Hence whether you are buying individual or group health insurance it is advisable to know there are several health plan varieties with their redeeming features.

Individual Insurance

This insurance plan is when an individual purchases the insurance cover not provided by an employer or an insurance plan limited in scope. The individual insurance policy can be paid for service, HMO or PPO protection. It is best to remember that individual health insurance plans do not offer as many benefits as group plans. We can safeguard our interests by checking the liabilities, protections and medical costs offered by different insurance companies.

Most health insurance companies provide a deciding period so that if you are not satisfied with the clauses you can return the plan and have your premium refunded.

Group Health Insurance Plans

This is the simplest and affordable of insurance covers. Group insurance is an employee welfare benefit plan providing medical care to employees and in most cases to their dependents as well. The sponsoring employer or union purchases the health insurance coverage from an HMO or an insurance company in exchange for premium or contribution. The HMO or the insurance company bears the cost of the benefits provided.

HMOs are in-expensive offering low co-payments, limited paperwork and provide coverage for several preventive care and health improvements programs. At the same time they are least flexible of health insurance plans requiring in-house consultations. In comparison POS plans are more flexible depending on insurance company's rules. You can consult an outside doctor but then the coverage received will be less than the stipulated amount.

Similarly PPOs provides policyholders financial incentives in form of co-payments to remain within the appointed practitioners. Incase you consult an outside specialist you have to pay the bill and submit the same for reimbursement.

Health Insurance Safeguards

COBRA (for the Consolidated Omnibus Budget Reconciliation Act of 1985)provides employees working for companies with 20 or more workers and who have been laid off or left their jobs to continue with health insurance for at least 18 months. The catch is that higher premium will be charged. COBRA also benefits students previously under their parent's insurance plans as well as divorced or widowed persons of spouses previously under group insurance plans. They can continue in the plan for up to 18 months till they have their own health insurance.

Church Plan-Health Insurance

A group insurance plan instituted by a church or a religious organization for employees and establishments run by them.

Group Health Insurance

Another way of benefiting from group insurance is through memberships in labor unions, professional associations, clubs or organizations.

Hidden Profiles of Health Insurance Schemes

Selecting the correct insurance plan requires patience and ability to see through the hidden frills attached. Before signing in on any insurance plan go through it thoroughly. For example plans that provide with freedom of choice of health centers and doctors may cost more than those with limited choices. Sometimes the cost, whether high or low, can be a catch.