Daily News Updates - Health Insurance News

The Young and Healthy, Pt.4 - Some more and summary.

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Short-term health insurance can last as long as a year but, more typically, is structured for 3 to 4 month periods. Most health insurers offering this type of coverage will allow ‘effective’ extensions as many as two or three times (hence, the annual duration). They usually must be renewed periodically. So they are not intended to be permanent. Because they generally come with so many exclusions, like ‘pre-existing conditions’ and are so short-term, they have been found to be a low risk to the health insurance provider. Consequently, the premium costs are usually quite affordable and most people who know about them, consider them to be a ‘no-brainer’. However, many people are unaware of them and that seems to be the biggest problem for those who find out too late.

Another specialty substitute is the ‘catastrophic’ type. While this type of health insurance is often misapplied as family coverage for those who couldn’t afford any health insurance, otherwise, it may be a good fit for the young and healthy. Also called ‘bare-bones’ coverage, this type of health insurance is recognized by their high deductibles and high co-pays, but also by their lower premium costs. Some major examples of such plans are the ‘Tonic’ and ‘Care 5000. These health insurance plans are offered by Blue Cross and come with the standard high deductibles. The lowest options start around $1,500 and rise as high as $5,000. Since this age group has such low risk, young adults might pay as little as $73 per month ($876 per year). After deductibles are satisfied, coverage will start to pay for things like ER visits and hospital stays. This kind of coverage has things like ‘lifetime maximums’ called ‘caps’ This plan caps at $5 million for total lifetime. Many of the standard options are excluded from this type of plan, which is not geared for routine health care. It is rare to find things like maternity coverage or preventive care. They are more geared for ‘major medical crisis’, as Mr. Hernandez puts it. He further warns of the dangers of being totally unprepared for sudden disaster. It can come quickly and submerge a family into financial bondage for years. Dave advises that everyone carry, at least, some kind of health insurance by saying . "For a couple hundred bucks a month, it's worth it."