Merritt Personal Lines Manual: Picking Your Plan
When it comes to health insurance these days, you have a choice: Do you want to join a health maintenance organization (HMO), a preferred provider organization (PPO)? Or do you want to pay more and get a reimbursement-style policy (Medical Expense plan) so that the insurance pays you back for a percentage of your costs, after you meet the deductible?
Because price is an important factor, about one in three Americans are enrolled in an HMO today, with 15 million enrollees in California alone. The other Americans are covered by a more traditional reimbursement plan, Medicare -- or they have no health insurance at all.
Going without health insurance is risky. What if you get injured and require surgery? The cost of a hospital stay can be as much as $400 a day. Or what if you or your significant other becomes pregnant? Even through a clinic, the price of prenatal care and delivery can exceed $5,000 today.
Insurance is designed to help you in these situations -- to assume the risk of paying your medical bills -- for a fee, of course.
If you have to pay for your own health insurance, you know it isn't cheap. But one major medical expense can make one or two or even 10 years' worth of premiums pay for themselves.
If you're searching for your own coverage, there is a tremendous variety of policies available in today's health insurance market. Some contain a single coverage (for example, hospitalization coverage only) or a combination of the major types of health insurance. Even if you're just choosing among the two or three plans offered by your insurance company or your employer, this chapter will cover what you need to know to choose the plan that's right for you.
