Premiums, Deductibles and Cheap Medical Insurance
Premiums and deductibles both refer to expenses that you will be responsible for. The premium is the amount that you pay monthly to the insurance company in exchange for them providing you with insurance that will pay a portion of your medical bills in the event of an illness or injury. Since you are looking for “cheap medical insurance,” you are looking for a “low” monthly premium. As long as your insurance is in effect, you will be responsible for paying this monthly premium, even if you never have a need to use your health insurance. If you stop making your premium payment, your insurance will be terminated. Most insurance policies will have a deductible associated with them. The deductible may apply to some or all of your covered benefits and are usually reset each calendar year. This is the amount that you will pay toward medical bills before your insurance starts paying. If you have an insurance plan that has a $1,000 annual deductible, you will be responsible for paying the first $1,000 in your medical expenses each year before your insurance company pays their portion. The health insurance plans that have the lowest premiums are typically the ones that have the highest deductibles. This is because the liability to the insurance company decreases when you take on more of the responsibility of paying your own medical expenses. People choose higher deductibles and lower premiums when they are primarily concerned about major medical expenses that could cause them financial hardship if they were to occur. 2 CommentsLeave a comment |
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Can you please tell me more about premiums and deductibles. I don’t understand those terms. I am 19, and I want the cheapest medical insurance. Can you suggest me any.
We can’t recommend one insurance company over another or suggest a specific medical insurance plan. However, we can help you understand the terms that are confusing you and explain what constitutes a cheap medical insurance plan.
All the medical policies that I have been covered under (until now) credited the entire amount I had to pay for a service toward my deductible. Because my current insurance pays next to nothing toward chiropracters, I go to a non-preferred doc. The insurance only credits the portion they allow against my deductible for these services. But, they credit the total amount I pay to preferred providers to my in-network deductible. Is this kosher?
Comment by Sue Tennessee — February 26, 2009 @ 7:49 am
This year my family only have one option for health coverage which is my husbands work related health insurance. It is a plan with $6000 deductible tied into an HSA. We tried to get our own insurance but because our daughter has a lazy eye, we were apparently uninsurable. The premiums for my husbands plan are higher than what we used to have with our former HMO plan.
We have already been forced to think about limiting the number of visits our daughter will take to the eye doctor, because with the new plan they will cost us $250 each time instead of $20, so that’s a huge difference. She also needs surgery but because of the new plan, she may have to wait. I can see how an HSA is a good idea in THEORY, but if you don’t have a lot of extra budget to deposit into it, then it doesn’t look as attractive. What is your take on high deductible plans and HSA’s?
Comment by Carol — June 27, 2009 @ 10:06 am