What is the best health insurance? This is question that many people just like you are asking themselves every day. How you answer that question really depends on what health insurance problems you want to solve. In other words, have you identified your specific insurance needs? It is important to understand that health insurance is not a discount off the price of health care. Insurance means risk management, and the monthly premium you pay is the price you pay the health insurer to take on the risk of your health care expense. One way of looking at this is that the company is making a bet that you will not need care. When the company pays the costs of your medical care, it has lost the bet, and you win in the sense that most of your expenses are paid.
Many people think that health insurance is a kind of price discount, but that is not true. Now that you know it is really a kind of risk management, you can see that there can be many kinds of plans to suit many different kinds of needs. If you have the money, you can even have an insurance company write a custom policy just for you. To keep costs down, health insurers offer set packages of benefits, and each package would include a slightly different menu of benefits. Normally, for many people, the term, health insurance plan, means something that pays for hospital and doctor care for either a single individual or for a family. Employer or union group health insurance is a policy offered through an employer or union to offer coverage for their employees. The kind of policy you choose, and the kinds of policies an employer makes available, depends on how much risk you want managed.
Some examples of household names that you are sure to recognize are Aetna, Blue Cross Blue shield, Humana, United Healthcare, Sterling, and Mutual of Omaha. Insurance companies are also known as “payers” because they are responsible for paying out on your insurance claims when need arises. Though there may be a relatively small number of companies with instant name recognition, there are literally hundreds upon hundreds of health insurers, and these are all separate payers offering different policies with different selections of benefits catering to different kinds of insurance needs. There are so many because health insurance is largely managed by private insurance companies regulated by Federal and State laws.
Is there such a thing as single payer health insurance? The answer is both yes and no. In the United States the insurance program that most closely approximates a single payer is the Federal health insurance program for retired individuals age 65 and above. This program is called Medicare and became law in 1965. Although the government manages Medicare, it contracts with private insurance companies to handle the day to day operational logistics of administration. So you see, even though the government is the single payer, it still involves the private insurance industry. The Federal government has gone even further involving private insurance by creating the Medicare Advantage Plan program, which essentially allows private insurance payers to manage Medicare benefits through private, managed care plans.
Health insurance choices can seem to be overwhelming. After all, there are not only many different insurance companies but many different kinds of policies as well. Some examples include, supplemental insurance designed to supplement or add on to an already existing health insurance policy; there is dismemberment insurance, temporary health insurance, hospital only insurance, disease specific health policies, and policies designed to pay only when your total out-of-pocket expenses reach a certain limit. The question of course, is how to do you choose?
Making a sound choice depends on a number of factors. You will need to make a list of your costs, needs, circumstances. For example, do you need medical care for only a limited period of time? If so, then a no frills temporary policy might work better for you than a more comprehensive, expensive plan. If you need coverage that will include all of your family, then you will probably look at a more comprehensive plan including both hospital and medical benefits. However, let’s say that you work in an environment where there is a realistic expectation of injury. In that case, you might consider catastrophic coverage, or possibly a dismemberment policy. When searching for health insurance, your understanding of your needs will be of primary importance in finding a policy that suits not only your needs but your budget.
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