Health Insurance and health care costs are skyrocketing. These costs place a large burden on American families, especially on those without access to group health plans who must purchase personal health insurance policies.
Factors in determining health insurance premiums
- The type of health insurance, i.e. individual or group insurance
- The age of the policy holders
- The health status of the policy holders; whether pre-existing conditions are included or excluded
- The coverage and benefits required by the policy holders
- The specific regulations set by each of the state government
- The duration of the policy, i.e. short term or long term
- The lifestyle of the policy holders, for instance, smokers or non-smokers, alcohol drinkers or non-drinkers
Group health insurance plans require employers to have four or more full-time employees who want health care coverage with the employers willing to pay a portion of their employees’ monthly premiums costs. These plans cover prescription benefits, preventative care, routine doctor visits, and catastrophic hospital and medical coverage. In order to meet the demand of masses, these plans have come up with various premium levels and plan choices to fit each company’s individual requirements.
Generally, individual insurance policies are taken out by one person and cover the spouse as well as children. Being different from group plans, personal insurance plans enable you to select options, for instance the amount of the deductible, the co-payment amount, the type of plan and the amount of coverage. Choose each option carefully as it affects the premium amount.
The average premium paid by an employer for each individual employee is $4,800 per year. If the coverage includes the employee’s family (a family of four members), the premium averages $17, 700 annually.
Online information has made the whole process of shopping and finding health insurance much easier than the “old” days of calling or visiting an agent. Simply conducting a search on a major search engine is sure to yield several sites that offer competing quotes. Check three or four different sites and compare prices and options.
Health care and health insurance will never be free. No one, including doctors, work for nothing. Yet the perception and understanding by the public over time has come to expect “Universal Coverage” as part of their tax burden with no restrictions to the type or amount coverage, and include a limitless supply of drugs, goods and other medical services. Health insurance marketers have sold us this vision and consumers have demanded it. Health insurance can be very expensive and millions of Americans are uninsured. The monthly premium payments are simply too expensive for a lot of people to budget for.
“Catastrophic” health insurance plans are also known as a high deductible plans. With this type of plan most medical costs would be paid out of pocket because the deductible is so high. These types of plans are meant to protect people from being financially devastated in the event of an accident, serious illness, or injury.
If you can couple your catastrophic health plan with a health savings account or HSA, this could help you pay for the occasional medical costs not covered by your high deductible plan. An HSA is a savings account in which pretax dollars are deposited. The funds in this account can be used to pay for medical expenses and withdrawals for medical expenses are not subject to federal income tax. You are effectively paying for your medical costs with tax-free dollars.
For someone with a chronic illness or a nagging injury that needs to visit the doctor on a regular basis a more traditional health plan would be required. For someone who is generally healthy and just wants to have coverage to pay for major medical expenses, a catastrophic health insurance plan coupled with a health savings account is a great option.
There are two primary factors that determine health insurance premiums. The first is your own health history as well as your family health. The second is age.
Insurance companies take into account both family history and personal health when calculating premiums for life and health insurance. Health insurance companies usually request blood and urine samples to verify that there are no pre-existing health conditions.
The majority of insurance companies provide plans with costlier premiums to individuals with serious or chronic conditions like coronary disease, cancer, diabetes or elevated blood pressure.
Since 1982, health insurance premium rates have risen on average 7% per year. The “Baby Boomers” as a group are having a major impact on the health care industry in the US, in terms of pharmaceutical treatment, in-patient care and doctor visits.
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