You probably have a lot on your mind as you leave college and head out into the big, scary world. Find a good job first, then a place to live, and maybe figure out how to pay back those student loans after that. Health insurance might not be something you think about. You've probably been covered by your parents' insurance your whole life, but that's about to change, if it hasn't already.
We know what's on your mind, "Why do I need insurance for my health? I'm young, healthy, and I don't go to the doctor very often. Then why should I pay for something I won't use?" Hey, we get where you're coming from. But accidents and illnesses can happen to anyone at any time, even fit young adults like you. Health insurance costs a lot, but not having it will cost you a lot more.
Things to know first
Let's get one thing straight: no one will argue that health care in the United States is a nightmare. There are a lot of ways to get care and pay for it, some of which are good and some of which are not so good. There is a lot of confusion about how to choose the right insurance plan for you. So let's find out more about what you can do.
Managed care and indemnity plans are the two main types of health insurance. Even though indemnity coverage costs more than a managed care plan, it gives you a lot more freedom. You can choose your own doctor, lab, hospital, or specialty clinic if you have indemnity coverage. When you go to the doctor, you'll have to pay an out-of-pocket cost called a "deductible" before your insurance will start to pay for your care. Depending on your policy, your deductible could be anywhere from a few hundred dollars to $1,000 or more. Also, indemnity plans require a co-payment for medical care. This means that in addition to your deductible, you'll have to pay a certain percentage of the cost of your care. Usually, indemnity plans only pay for care after an accident or illness. They don't usually cover care to keep you healthy.
Indemnity coverage is the exact opposite of managed care. Most of the time, co-payments are lower, deductibles are lower, and preventive care is usually covered. But you don't have many choices. With a managed care plan, you can only choose from doctors and hospitals that your health maintenance organisation has contracts with. If you go somewhere else, you have to pay the full price. Since that sounds like a pretty bad deal, many managed care plans are starting to offer hybrid plans that have many of the good things about indemnity plans.
where to go?
If you're single and you find a job that gives health insurance, you should take it. Even though it's not perfect, it's better than anything you could find on your own. If you sign up through your employer, you will probably have a lot of choices. Look at them carefully and ask a human resources representative for help if you need to, but make sure you choose the right plan for you. If you're young and healthy, you probably want a plan with a low premium and a high deductible. Look for a plan that keeps your out-of-pocket costs as low as possible. Depending on your employer, you may or may not be able to choose between an indemnity plan and a managed care plan. Both have good and bad points, so make sure to do the math before choosing one or the other.
Make a deal with yourself.
Even though health insurance costs a lot, there are ways to save money on it. If you work for yourself, look at different plans before you choose one. If you're under 50 and in good health, insurance companies will want your business, and you can get lower rates. Also, use any time off that Uncle Sam gives you. People who work for themselves can write off up to 45% of their insurance costs. Some employers offer flexible spending accounts where you can put cash that isn't taxed to pay for insurance premiums and costs that aren't covered by insurance.
If you are married and your spouse can also get insurance through their job, think carefully about what you want to do. If you weigh the pros and cons of separate coverage, double coverage, or one of you dropping out of your work plan and signing up for the other's, it might be better for you financially and in terms of coverage.
Lastly, look into "catastrophic coverage" if you've been healthy and think you can get by with the least amount of health insurance. The premiums for this indemnity policy are very low, but the deductibles can be very high—up to $2,500.00. Coverage is very limited to "catastrophic" events, which you'll need to learn all about.
