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Thursday, August 9, 2012

Maintaining Health Insurance in Tough Economic Times

Having a frugality blog, you may find it curious that I never talk about health insurance and health care whatsoever (other than alternative or home remedies, of course), specifically because health care is one of the biggest expenses the average American has, let alone someone not in the peak of health. To be honest, I've never had to pay for health insurance, because I lived in the US only until I was 18, when I was still covered by my parents' health insurance; as soon as I got married, I moved abroad where the health care system is entirely different, and I don't need to allocate large sums to pay for health insurance.
So, the reason I don't write much about health insurance is because I have very little experience or knowledge on the subject.
However, Sean O’Connor, a blogger at GoHealthInsurance.com shared this nice piece with me to put on the blog, with some ideas on how you could, perhaps, save money on health insurance. Hope it helps you out!

Whether money has always been tight or you’ve just recently hit a rough patch financially, it is always a smart idea to cut back on unnecessary spending. It’s not fun to do, but it’s the responsible thing to do.
All too often, people make the mistake of clumping health insurance coverage into the “unnecessary spending” bin. Don’t ditch your health insurance coverage and keep your premium cable package, folks. Not having health insurance is more costly than having it, to be sure. There are less expensive options out there that you may not be aware of. Let’s talk about it.


High Deductible, Low Premium Plan
This type of plan is often referred to as “catastrophic coverage.” The majority of people who buy catastrophic coverage are healthy young adults or adults between the ages of 50 and 65 who can afford occasional medical upkeep but do not want an unexpected health crisis to ruin their finances. This plan is not a good fit for someone with a pre-existing condition or on-going health concerns.

Clearly, the most attractive aspect of a high-deductible plan is the extremely low monthly premium. Also, under health care reform, these plans must cover 100 percent of preventive care. However, in the unfortunate event that you should have to use this coverage, keep in mind that the insurance company will not pay anything until you have met the agreed upon high deductible. Catastrophic coverage is not comprehensive, but it will give you piece of mind that an unexpected health crisis is not going to bankrupt you.

Short-term Coverage
A short-term health insurance plan may be ideal if you are having cash flow issues now, but can see a light at the end of the tunnel. These plans provide coverage for a succinct period of time, from a couple of months to a year. Like catastrophic plans, short-term coverage is designed to help you out in case of a major, unforeseen medical emergency. Because of this, routine medical expenses such as doctor visits and prescriptions are not covered under this type of plan. Also, people with pre-existing conditions typically will not be accepted for coverage under a short-term plan. On the plus side, the application process is usually quicker and easier than a long-term, traditional plan.

Under 26 Years Old? Get on a Parent’s Plan
If you are young, full of promise and broke as a joke, consider calling Mom and Dad. Under health care reform, young adults can join or stay on their parents’ health insurance until the age of 26. You don’t have to wait until 2014 for this one – young adults can take advantage of the new law right now.

Research, Research, Research!
An informed health insurance choice is always the best health insurance choice. This process doesn’t have to be a nightmare. There are resources out there that can be a tremendous help. GoHealthInsurance.com allows you to compare rates and plans available in your state with ease and offers a wealth of knowledge on health insurance-related topics.

What do you do to keep your health insurance bills low, or at least as low as possible? Or do you just assume that high health insurance costs are non negotiable?

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