Health Insurance - An Important Decision

By Compuquotes Team on March 27th, 2008
Health Insurance

Health insurance may be one of the most important kinds of insurance. For many Americans, a really bad accident or illness can put you in the hospital for months, leaving you and your family in debt for the next 20 years from rising costs of doctors, hospitals, drug companies, and medical laboratories.

You are forced to rely on either the good fortune of not getting ill or injured, or insure your future and purchase health insurance. Chances are eventually you will need the services of a physician and a stay in the hospital.

There are several options available in which you may acquire heath insurance including individual policies, group coverage, and government benefits.

You can purchase an individual insurance policy either directly from an insurance provider or through agents and brokers. Unfortunately purchasing individual or family insurance policies can be highly expensive. Some applicants with significant health problems will find that they might not be able to obtain an insurance policy, and if they are successful it is likely to be filled with many exclusions and restrictions.

Group insurance policies are sold to an organization of people who share a common interest. The organization may be a corporation, union, trade association, club, religious society, or any other identifiable collection of people an insurance company is willing to recognize as a group.

The main benefit of purchasing group policies is that you can usually get a premium rate because the group has power in numbers. When purchasing health insurance in a group, preexisting conditions are likely to be covered. Many health insurance policies will exclude identified medical conditions that existed prior to the health insurance going into effect, referred to as preexisting conditions.

Often there preexisting condition make it impossible for certain people to obtain a health insurance policy. Often there is only one way around such a problem. Somehow join a group that is large enough to have negotiated a concession from the insurance carrier whereby the company gives up the right to exclude such preexisting conditions. This concession is the difference between obtaining coverage or risking health as a member of the uninsured.

Many health insurance companies require a close look into the health of an individual applicant during the underwriting of the application. This usually includes a complete physical examination. If you are unfortunate and have poor health, you should be aware that group members are often able to obtain insurance without this detailed investigation into their health.

There is also a large negotiating power of a group, the bigger the better. Group members often allow members to receive better total benefits at a lower rate. This not only refers to premiums but also with regard to expenses that individuals must pay themselves.

Groups pay a lower rate overall, and a lower deductible means less money out of your pocket should you have to file a claim.

It doesn't matter whether you purchase group or individual insurance, the options you have regarding the different types of health insurance are generally the same. These types include traditional health insurance, health maintenance organizations (HMOs), and preferred provider organizations (PPOs).

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