Health insurance costs are quickly chiseling away at the American income. The worst part is, that it’s not letting up, and it looks like costs are going to continue to rising.*In the year 2003, health insurance premiums took around 15% of the average family’s income. Back then, even that was too expensive. In 2010 that percentage has risen to nearly 20% of income. Many Americans have no choice but to take drastic measures to lower their health insurance costs.There are several options to lower your health insurance costs. As a health insurance agent, I’ve seen family’s drop coverage altogether and hope for the best. I’ve watched parents go uninsured just to make sure they can afford coverage for their children. However, these options leave a family wide open to catastrophic financial ruin in the event of a major medical situation.So, what if a family could drastically lower their health insurance costs and still protect themselves, with a health insurance plan that covers medical expenses after a relatively high deductible?That’s exactly the idea behind catastrophic insurance coverage. You move from a traditional health insurance plan to a plan with a high deductible and less bells and whistles. You take on the risk of the everyday expenses (within the deductible and coinsurance limits) and rely on the insurance company to cover the rest. Your monthly premium goes down, and you save hundreds, if not thousands, of dollars per year.
If you stay healthy throughout the year, you keep the savings!
If you have some medical care, you pay for it out-of-pocket and keep the rest of the savings.
If you have serious medical expenses, you pay for them up to your deductible amount and the catastrophic insurance coverage kicks in.
The great part about it is: you actually have an opportunity to keep a good portion of the money that you would have otherwise paid to the insurance company by being on plan with coverages you didn’t necessarily need.Here’s how you’ll know if this solution might be the right move for you or your family:
You don’t have any chronic conditions that require expensive treatments.
You don’t take any expensive prescriptions.
You or your family don’t over-utilize your benefits in a normal year.
If those three statements generally describe your situation, this money-saving insurance solution is worth exploring.*According to a report entitled “State Trends in Premiums and Deductibles, 2003-2010: The Need for Action to Address Rising Costs” by CommonWealthFund.org.
