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Many United States citizens lack medical coverage. College students and young people just starting their careers are often without coverage. Recently unemployed individuals, or those in between jobs, helplessly watch their medical benefits cancel, leaving them without protection.

Generally, healthy people without pre-existing conditions or individuals who don't see the doctor regularly may not worry about medical coverage, but the question of a health insurance plan lurks in the back of their minds. A catastrophic health insurance plan functions to fill the void in these and other situations. 

When considering a catastrophic health insurance plan, wading through coverage terms, conditions, and prices to find the best plan can be perplexing. In order to make a wise, informed choice, consumers must compare terms, conditions, and prices against health needs and their current financial situation so that the catastrophic health insurance plan they choose provides peace of mind.

The plan

In its most basic form, a catastrophic health insurance plan provides catastrophic medical coverage at low monthly premiums. A typical annual deductible begins at $1,200 for an individual and $2,400 for families, but the right plan depends on a person's health and budget.

Basic costs

Monthly premiums, deductible, co-pay and co-insurance costs vary between insurance providers; however, the lower the monthly premium, the higher the annual deductible and vice-versa. For generally healthy individuals who don't need to see the doctor that often, a high annual deductible makes sense. A catastrophic health insurance plan covers emergency visits to the hospital, along with any procedures due to unforeseen medical conditions.

Premium vs. deductible

When comparing plans, present health conditions and financial ability generally determine the type of coverage necessary. Lower monthly premiums mean that initial output is generally low, but if a medical situation arises and $5,000 of medical bills pile up, the policy holder is responsible to pay the annual deductible amount before coverage kicks in. For example, if the annual deductible is $4,000, payment from the insurance plan won't begin until the premium holder pays that amount.

Therefore, choosing a catastrophic health insurance plan depends on the amount of money an individual has set aside or is able to set aside through a personal savings account or a health savings account (HSA). In order to qualify for a tax-free HSA, the deductible for an individual and family is $1,100 and $2,200, respectively.

Comparing benefits

Catastrophic health insurance plans can vary significantly in coverage and benefits. Knowing which one is suitable depends, again, on health needs vs. finances. Here are a few things to look for:

Plans often restrict access to doctors within the plan network. Before purchasing a plan, individuals should check to make sure their doctor and local hospital are part of the network.

  • The insurance plan should clearly state if coverage is for an individual or a family.
  • Some plans require a waiting period before coverage is activated.
  • In addition, few plans cover pre-existing conditions.
  • Certain plans include prescription benefits and preventative care, while some don't. These benefits typically increase the price.
  • Those desiring to add additional coverage at a later date should explore this option.
  • The best choice in a catastrophic health insurance plan provides coverage designed to meet the particular needs of the applicant. Individuals and families seeking such a plan require an affordable monthly premium and annual deductible, and benefits, such as prescription coverage, that target current medical needs.

This article was written by Anita Alvarez, an expert
in the Health Insurance category at www.yoexpert.com
How Do I Know Which Catastrophic Health Insurance Plan Is Right For Me?
How Do I Know Which Catastrophic Health Insurance Plan Is Right For Me?
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