Health insurance for most people is provided by an employer in the form of a group health insurance plan or purchased as an individual policy. Individuals that need additional coverage can purchase a supplemental insurance policy or a type of policy known as catastrophic health insurance. A catastrophic health insurance policy has many considerations which can include the size of the deductible and the price of the policy.
A catastrophic health insurance policy typically contains coverage for medical expenses that can diagnose or help an individual avoid a catastrophic illness. This can include expenses for x-rays, a visit to a hospital, various types of lab tests, as well as surgical and non-surgical stays in intensive care. There are however various expenses that are not covered which can include doctor visits, prenatal care and some types of pre-existing conditions.
The costs for a catastrophic health insurance policy can vary depending on the deductible for the coverage that is needed. Most catastrophic health insurance policies come with a high deductible up to $1.100 or more. The premiums for a policy are usually lower than other types of policies because of the high deductible requirements and other restrictions that apply. The good news is that once the deductible is met insurance will pay for all other covered expenses.
Shopping for a Policy
When shopping for a catastrophic health insurance policy that are many questions and information to know before purchasing a policy. This can include knowing how much the deductible is for the policy and how much the premium payments are going to cost. Other important information to know is how much coverage will be necessary as well as any pre-existing requirements or exclusions that apply to the policy.
There are many pros and cons of a catastrophic health insurance policy that need to be considered before purchasing a policy. One benefit with this type of policy is that the monthly premiums are lower because of the high deductible. Another benefit is that a Health Savings Account can be setup to help with premium payments. The downside is that individuals will need to be accountable for all expenses that are incurred before the deductible is met.
Health Savings Accounts
Individuals that have a catastrophic health insurance policy with a high deductible may be able to open a tax-exempt health savings account of has. The option became available for certain types of health plans beginning in 2008. A health savings account allows an individual to put pre-tax money into an account that can then be used to pay for certain medical costs. One benefit of a health savings account is that money that is spent for approved medical expenses is not taxed.