Medical Health Coverage

By: EconomyWatch Content   Date: 16 February 2010

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Almost every year, medical expenses contribute towards a number of bankruptcy filings. As per statistics, almost 60% of bankruptcy cases are triggered by medical bills and the individual’s incapability to pay them. Against such backdrop and with healthcare costs following an upward trend, the need for buying medical health coverage has become imperative.

Medical health coverage can save you from the increasing medical cost by offering protection for regular as well as critical medical checkups. Coming in different variants with different coverage, medical health insurance can offer coverage for maternity to pre-existing diseases.

Picking the Right Medical Health Coverage

Even before one starts looking for medical health coverage, it is crucial to identify one’s health as well as financial conditions. While a person in the process of changing jobs can benefit from short terms plans, the self-employed can opt for long-term ones.

Also, medical health coverage comes in various operation styles, namely managed and indemnity.

Managed healthcare operates through a network of medical facilities. Health Maintenance Organization (HMO) is an example of managed healthcare where the insured have to visit a Primary Care Physicist (PCP) before they can be referred to any other specialist. As this type of healthcare operates through a closed network of medical facilities, options for patients decrease. However, the positive side is that there are lesser or no deductibles and co-payments are smaller as well.

Preferred Provider Organization (PPO) offers more flexibility in terms of choosing the healthcare provider; however, it costs more than HMOs in terms of deductibles and co-payments. Overall, PPOs have a higher out of pocket cost; therefore, they might not be the best option for people with bigger families and lesser income.

Indemnity plans or pay for service plans offer the freedom of visiting any doctor and may be the best options for people who want to be protected for critical conditions and are in their prime. However, indemnity plans may be the costliest medical health coverage option, as the deductibles are pretty high and the coverage is limited. A person typically pays a rather larger portion of bills every time.


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