July 23, 2013 Admin | July 23, 2013 What is a catastrophic health insurance plan? Who might benefit financially from this type of plan? Why?
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Catastrophic health insurance plans are designed to provide an emergency safety net to protect you against unexpected medical costs.
Catastrophic plans are individual and family health insurance plans that emphasize coverage for hospitalization or serious illness. The word “catastrophic” is not always used in the name of the plan – they may also be referred to as hospital-only or short-term plans. Catastrophic plans may not provide coverage for other services such as prescription drugs, regular doctor’s visits, immunizations or checkups.
Monthly premiums for catastrophic plans may be lower than those of other health insurance plans but annual deductibles are usually higher. That means you may have to pay for the first $2000-$5000 of medical expenses each year before the insurance company begins to pay for covered services.
If you’re relatively healthy, young, or expect to have employer-based health insurance within 6-12 months, a catastrophic plan might be right for you. You’ll want to be sure you can pay the deductible in case of emergency, but catastrophic coverage can still provide valuable financial protection in case of emergency.
Outstanding, Macala! You provided a very clear and concise answer to this sometimes confusing part of life (health care). These type of plans provide health insurance for people who need it when insurance at work may not be available. The monthly premiums are low (under $300 in many cases) and the yearly deductible is high just as Macala highlighted. The young, the folks with preexisting conditions, the early retired, the small business owner, and the healthy may be prime candidates for this type of health insurance. Educate thoroughly before taking on this type of plan.
You can learn more on this subject by going here: http://www.pbs.org/newshour/rundown/2012/04/top-10-things-to-know-about-high-deductible-health-plans-1.html