May 12, 2020

Private Medical Insurance – What You Should Know and Why

While having health insurance is currently not a right in the U.S., it is now a requirement. Recently passed government legislation (HR 3590) mandates that everyone must have health insurance. If your employer does not provide you with health insurance, if you are unemployed or retired and do not qualify for federalstategovernment health insurance coverage, you will need to obtain private medical insurance.

This major Health Care Reform Bill has, for all practical purposes, had the indirect effect of making knowledge of the basics of private medical insurance a requirement.

If you currently have health insurance through your employer, you may believe that you do not need to take the time to familiarize yourself with private medical insurance. It is frequently said that some people are a certain number of paychecks away from being homeless. It may become as common to hear about being one pink-slip away from private medical insurance, especially once people who suddenly find themselves unemployed see the premium for their first COBRA payment.

The new legislation aside, there are many reasons everyone should learn about private medical insurance. If your company does provide you with health insurance, chances are that it does not provide coverage for everything. This type of group health insurance usually excludes certain medical tests andor procedures, it probably only covers treatment by specific doctors, it may not even cover your family.

In all likelihood you will, at some point and for some reason, have a need for private medical insurance. It is not advisable to wait until some unforseen illness or injury makes the matter urgent. You will find it much more difficult, not to mention expensive, to obtain insurance when you are sick or hurt. Insurance companies obviously cannot pay out more money for claims than they take in from premiums without going bankrupt.

Companies that provide employers with group health insurance for their employees tend, therefore, to rely on what is known as adverse selection. When a company determines that it is paying more in claims for the group than it is generating in premiums, the company will raise the premiums. Most employers that provide health insurance deduct a portion of the groups premium from each employees paycheck. In such a case, even if you had never filed a claim, you will wind up paying more for the insurance. You will also see an increase in your portion of the groups premium as you grow older, claims or not.

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Then there is the predicament of people who have pre-existing conditions. The phrase suffer from pre-existing conditions would be inaccurate in this case, as a healthy woman in her first trimester of pregnancy would likely have as much difficulty obtaining health insurance as would a woman under treatment for cancer. In fact, the healthy pregnant woman might have a harder time, as there are certain companies that specialize in coverage for people being treated for diseases such as cancer and diabetes. Additionally, some states do not allow companies to refuse to insure people based upon any pre-existing medical conditions. The Patient Protection and Affordable Care Act will, albeit gradually, make compliance with the health insurance requirement less costly and will, hopefully, simplify for everyone the process of obtaining private medical insurance.

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The most important factors to consider when purchasing private medical insurance are the same as with auto insurance, life insurance, even a full coverage dental plan. You need to ensure that the policy will meet your needs and those of your family, plan for contingencies to the best of your ability, do your homework on companies offering the coverage you want, and obtain several quotes from each of those companies. Once you compare the quotes you get with the coverage offered with each, you should easily be able to make the selection that is right for you.

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