Health Insurance for Starter Families
Starting out in life is tough and starting out with a family can be even tougher. You want to do everything you can for them and, just in case, you want them protected. One of the most important types of protection is Health Insurance.
Why Health Insurance?
Health insurance protects you and your family from the high cost of medical care. In the most basic form you pay a monthly premium and the provider offers certain coverage. One common fear is the cost of health insurance but imagine what the consequences could be of not having coverage. Medical bills from a small playground accident can delete any savings and a major illness could put you into bankruptcy.
There are basically two types of plans, Traditional or Indemnity and Managed care. Indemnity also known as "Fee for Service" generally covers illness and accidents. There are no provisions for preventive care (flu shots, birth control, yearly wellness checks). And they may not offer prescription coverage. A big advantage is that you will have more freedom as to choice of doctors but you will pay for it with higher premiums.
Managed care is what most of us are more familiar with. These include HMOs (Health Maintenance Organization) and PPOs (Preferred Provider Organization). HMOs offer lower premiums by offering care through a network of doctors and hospitals. Co-payments are generally lower and prescriptions, preventive care and mental health are covered.
PPOs are like a combination of the "Fee for Service" and the HMO. You have the option to use doctors out of the network but you will pay a higher portion of the cost. Using doctors within the network will save you in out-of pocket-costs which could include co-payments, deductibles, or other fees that you are required to pay outside of your health benefits plan. Premiums for PPOs are generally higher.
Choose a health Plan
Health insurance can add to the family budget, but there sensible ways to save money by shopping wisely. If you look around you will find options. If your employer offers insurance you should take advantage. You will almost always get a better premium with group or employer-subsidized plans.
Whether you are getting insurance coverage through your employer or you have to buy it yourself it is important to do your homework and pick the plan that is right for you. Another good idea is to investigate insurance brokers. A broker has access to multiple providers and can help you make the right choice. Some questions you should ask your broker or while shopping around:
- Does the plan cover the services I may use? Are there any pre-existing conditions, do you plan on having children. Does their network cover favorite doctors or hospitals?
- Prescription cost, how much they cover, what they cover. Do you have any special prescription needs?
- What are the co-payments?
- What are the deductibles? A common mistake is to choose a high deductible to keep the premium low. This could actually prevent you from getting care if you can't cover it so keep the deductible realistic.
- What expenses have t be paid before reimbursement
Before you make a final decision with a company take a few minute and get online and check them out. Look for things like complaints or high dropout rates. Look for accreditations and memberships. Purchasing health insurance is one of the most important decisions you will make for your family and it is a choice that needs to be made wisely.