Medical insurance

Medical insurance is one of the most critical and utilized insurance plans that one can have. According to a survey conducted by the Medical Expenditure Panel in 2003, the average cost for an emergency room visit was $560, and it has surely went up in cost since then. If you need to have even a simple surgery, you could be looking at paying tens of thousands of dollars. Because of the high cost of medical care combined with the often unanticipated arrival of a health issue, medical insurance, also known as health insurance, is normally well worth the expense over the course of one's lifetime.

Medical insurance can be obtained from a number of sources. Many individuals are lucky enough to obtain health insurance from their employer, normally at a somewhat reduced cost. Group medical insurance allows a group of individuals, often from an company or organization, to come together to receive special lower rates from the insurance company. The end savings to the member comes from this reduced cost, as well as some companies will subsidize a portion or even the entirety of the insurance premium as a benefit to the employee.

If you do not work for an employer that offers medical insurance, you may choose to obtain an individual plan. The disadvantage to individual health insurance is that the cost is normally much greater than if you were covered under a group plan. Also for those that have pre-existing health conditions, the health standards are much higher, often facilitating the need for a medical exam prior to acceptance. If they feel you are a high risk member, you may receive insurance at a higher rate or the company may deny you coverage altogether.

There are also a few other means in which one can obtain medical insurance, like student plans through a school or Medicare or state-run health insurance programs, but most can be divided up into the two categories: individual or group.

Medical insurance can vary greatly both in cost and coverage, often with a direct correlation. There are many different types of medical insurance plans available. A HMO (health maintenance organization) offers some of the lowest premium rates and best coverage, but a covered member must only go to doctors or hospitals within the HMO network, and often must receive a referral from their chosen medical doctor, often referred to as their PCP (primary care physician), in order to see a specialist. HMOs place specific focus on regular health maintenance in hopes of preventing potential major illness, so they encourage members to schedule regular visits to that end.

A PPO (preferred provider organization) can be similar to an HMO, but it consists of a group of doctors and hospitals that only serve a specific group. Though members can go out of the network, the rate of coverage on services goes down dramatically, and in some instances, no coverage is offered out of network. The covered member normally must pay a co-pay at the time of their visit, which is a set amount ranging from $10- $50 on average. Often, the covered member will have to pay for all charges at the time of service, and the insurance company will later reimburse the member less the co-pay amount.

A POS (point-of-service) plan is another type of medical insurance plan that tends to be a combination of a HMO and PPO. There is normally not a deductible, a small co-pay on visits, and you choose a PCP, who is your first point of contact in a health situation. However, if you go outside the network, a deductible and larger co-pay may be applicable, and like a PPO, the rate of coverage drops dramatically.

The final type of medical insurance is called Major Medical insurance. As the name suggests, this type of plan is designed to cover your major medical situations-- surgeries, extended hospital stays, ongoing illness, etc. This plan does not typically meet the needs of your ongoing maintenance, as coverage only really begins after a large deductible (initial portion of claim not covered) and co-insurance have been met. Major Medical also has a maximum which can be reached, and though there are various types of major medical plans, many individuals find that usage of the plan is not advantageous unless a very costly hospital stay occurs.

Though there is a lot to learn about medical insurance, most individuals find the coverage to be indispensable, as everyone has to go to the doctor at one point or another, and especially as we get older, we find that the unanticipated hospital visits tend to increase, along with the corresponding costs. Medical insurance can provide some peace of mind in this process.