If you can only have one kind of insurance policy in your life, then you should certainly make sure that you have health insurance.
Unexpected medical and health expenses are the number one cause of bankruptcies in the US, and the American health system is the most expensive in the world.
Health insurance won’t cover every health expense in your life, but it can protect you from potentially life destroying financial consequences from an unexpected medical situation.
Many policies will have out of pocket maximums in which the insurance company will pay everything after you reach a certain threshold.
Having established the clear need for health insurance, below we will detail some steps you should take to ensure you have adequate health insurance coverage:
Step 1: Verify what coverage you already have
Before you shop around for a health insurance policy, you should make absolutely sure you don’t already have one or are paying for one through some other means.
If you work at a traditional company, check with your Human Resources or Benefits Department. If you work by yourself, you may still actually have some coverage through your spouse, your uinversity or even from your previous employer.
Recognizing that most Americans have employer provided health insurance, the federal government enacted the COBRA act, enabling former employees, former spouses, and dependent children to continue to have the coverage they had under their previous arrangement.
The catch with COBRA coverage is that you must pay whatever portion your employer used to pay before. This amount could easily be thousands of dollars a year.
Step 2: Ensure you have your latest medical exams and are aware of your current conditions
In order for any insurance company to provide you a quote, you are going to need to have all your health exams, blood tests and medical records up to date: To the extent that you already have these documents, it will make the whole process go smoother.
Later on in this artcile we will detail some of the annual and preventive health screenings that your insurance plan will eventually cover, but for this step you want to make sure that you gather all existing documents and do not necessarily include any additional tests as you will need to pay for these out of pocket.
If your insurance company requires some additional tests and they will not pay, you can check with community or non-profit organizations, as they sometimes have special community programs to provide certain screenings free of charge or at reduced prices.
Step 3: Obtain coverage through your employer or affinity group
The best option for those who have access to it is to obtain health insurance through your employer.
If that is not possible, then the second best option is your spouse’s employers. Many employers spend a large amount of their budget in health insurance premiums as a way to enhance employee retention, with the benefit to the employees being heavily subsidized coverage under a group rate.
If you do not have access to an employer provided health policy, do not despair – you may be surprised to know that many affinity groups also offer preferential rates. Some popular ones include United Service Automobile Association for military or military relatives, the Association of American Retired Persons (AARP) for seniors for networks that have national coverage.
Make sure to check any groups that you may be a part of, as many of these tend to be local arrangements, such as the local chamber of commerce offering a discounted rate for local business owners.
Step 4: Check your state healthcare marketplace on healthcare.gov
Particularly if you have pre-existing medical conditions, you should definitely check any plans on healthcare.gov as they all must legally cover you even if you have any medical conditions before applying for health insurance. Healthcare.gov is a government run website arising out of the Affordable Care Act, in which customers can shop for health insurance plans available in their state.
Step 5: Continue to monitor your health yearly taking advantage of preventive screening
Insurers know that it is much cheaper to pay for preventive treatment than to pay for corrective surgery when a health condition has advanced significantly. Due to this, they often offer free coverage for a certain amount of preventive treatment. Some items typically covered for free are:
- Annual physical exam
- Colonoscopy for adults over 50
- Mammograms for breast cancer screening
- Cervical and lung cancer screenings
- Annual immunizations
- Annual blood test
- Annual eye exam
- Annual dental cleaning
In addition to this, you should consider adopting healthy habits that will improve your overall health and reduce your risk for disease later on in life.
Some of these healthy habits include adpoting a healthy diet, exercising regularly, getting enough sleep and adopting measures to manage your stress. You should check with your health insurance plan, as you may be surprised to find out that many health insurance plans actually are willing to subsidize the cost of a gym membership.
Insurance companies, after all, realize that healthy customers will very likely be less expensive customers for them in the long term. Having said that, we realize that many people are at a stage in their life where they simply have circumstances that prevent them from taking some of these measures, and we fully understand that – we just want you to know that if you are able to, you can see some real benefits in your insurance premiums and overall health if you do take some of these measures.
We hope that the tips above help you determine what the right health insurance policy is for you.
Remember that unlike life insurance, you only “lock in” your health insurance premiums for a year, and it is very possible that they can increase significantly from year to year.
If history is any indication, expect health insurance premiums to rise significantly over the coming years, and budget accordingly.
It is for this reason that employer provided health insurance plans will continue to be the way many Americans receive their health insurance, but there will always be a market for private health insurance plans.
Above all, stay healthy.