With so many different types of health plans available, it can be hard to know what’s right for you. You may even be wondering, “What is the difference between a comprehensive health insurance plan and a short-term health insurance plan?” Or “What is the difference between critical illness insurance and hospital cash insurance?” Well, wonder no more! We’ve created this guide to help you understand each type of health plan so that you can choose the one that fits with your needs and budget.
Comprehensive Health Insurance Plan
A comprehensive health insurance plan is a type of policy that covers the costs of an array of medical services, including hospital visits and procedures, doctor visits, prescription drugs and other services. Most comprehensive plans also cover preventive care before they become necessary or urgent.
Comprehensive health insurance plans are available in both employer-sponsored and individual markets. The Affordable Care Act (ACA) requires all non-grandfathered plans to provide certain essential health benefits at no cost to you. Depending on the state where you live, some or all of these benefits may be covered by your state’s Medicaid program as well; check with your state Medicaid office for details about this coverage possibility.
Short-term Health Insurance Plans
If you’re looking for a plan that will cover pre-existing conditions, but don’t want your coverage to last more than 12 months, a short-term health plan may be right for you. Short-term plans are not required to follow the rules of the Affordable Care Act and can exclude people who have pre-existing conditions.
Although they are not considered comprehensive health insurance plans, short term plans may be a good option if you know that you’ll only need coverage for one year or less.
Critical Illness Insurance Plan
A critical illness insurance plan is a type of health insurance that pays out a lump sum if the insured person is diagnosed with one of the covered conditions. It’s an important way to ensure that you’re financially protected if you or your family member is diagnosed with something like cancer, heart disease or stroke.
The cost of a critical illness insurance plan varies based on factors such as your age and whether you have any pre-existing conditions. For example, in 2019 men between 35 and 44 years old can get term life coverage with no medical exam for $2 per day ($83 per month) while men over 65 can get the same coverage for $1 per day ($40 per month). The average monthly premium payment was $91 in 2018 according to data from LIMRA Secure Retirement Institute (the high end was $170). Here are some other things you should know about purchasing this type of policy:
Hospital Cash Insurance Plan
A hospital cash plan is a type of insurance that covers inpatient hospital stays. They are typically purchased by people who have limited or no health care coverage and can be used to pay for unexpected medical expenses.
Here’s what you need to know about this type of plan:
- It does not cover outpatient care, doctors’ visits, or prescription drugs.
- It does not cover emergency room visits outside your primary area of residence unless you have an extended stay (more than 30 days) in the hospital.
- You must stay in the hospital for at least 48 hours before any benefits from these plans kick in; otherwise, your expenses will be billed directly to your credit card or other available payment method (such as cash).
Accident Insurance Plans
Accident insurance plans are designed to cover medical expenses resulting from an accident or injury. Depending on the type of plan and your specific coverage needs, you might be able to get reimbursed for lost wages as well.
How they work: There are two main types of accident insurance plans: indemnity policies and reimbursement services. Indemnity policies are usually less expensive (and therefore more popular) because they reimburse a set amount according to your policy’s terms—for example, up to $1,000 per day for hospital stays or up to $30 per visit for out-of-pocket costs like prescription medications. In contrast, reimbursement services pay only what the healthcare provider actually charges; this means that if you have a large deductible or coinsurance percentage, it will take longer for them to pay out than with an indemnity plan.
Choosing an accident insurance plan: Choosing an appropriate level of coverage can be difficult because there aren’t any hard rules about how much protection you need in order not to be financially affected by an injury or illness. The best way is probably just being honest with yourself about what kinds of bills could derail your finances and then choosing a plan accordingly (in other words: high enough so that any serious illness would not wipe out several months’ worth of savings).
Learn about the different types of health plans and choose the right one for you.
Choosing the right health plan is a big decision. It’s important to consider all of your options and choose the plan that fits your needs.
- Is your budget tight? You may need to prioritize cost savings over coverage, which means choosing an HMO or PPO with lower premiums than other plans.
- Do you need a lot of access to specialists? If so, look for an EPO/POS plan with a large network of doctors and hospitals in case something comes up unexpectedly.
- Do you have young children who might need regular checkups at pediatricians’ offices? If so, look for plans that cover preventive care without requiring copays (typically HMOs).
We have covered a lot of information in this article, but we hope that it has given you a solid understanding of the different types of health plans available. While there are many different options to choose from, we recommend starting with a comprehensive health insurance plan or short-term health insurance plan before exploring other options. This way you have the security of knowing that if something does happen, your costs will be covered by your plan.