insurance healthWhile the financial struggle is an everlasting battle for all of us, some seem to cope better than the others. We all have our own secret weapons in this struggle to make ends meet. And yet, as surprising as it sounds, one of the leading causes of insolvency is medical debt. For example, in Australia, millions of people lack good health insurance cover and for this reason, many of them usually end up settling huge medical bills directly from their pockets. Even though the cost of premiums from different health insurance plans is normally expensive, having at least one plan covering you and your loved ones is very important.

The Basics You Should Know

The Categories of Insurance

There are two broad categories of health insurance as far as Australia is concerned. The first is the hospital cover and the second is the general treatment cover.

  • The hospital cover normally focuses on settling all kinds of expenses related to treatment in a public or a private hospital. Currently, there are various types of hospital cover which offer solutions to different needs. According to analysts, some hospital cover usually settle all bills related to treatment in the hospital while others usually settle specific bills as stated in the contract agreement.

  • Unlike hospital cover, general treatment cover usually focuses on settling bills which are related to additional medical conditions such as optical care, dental care, ambulance cover, physiotherapy cover, chiropractic cover, pharmaceutical cover any many others.

The Types of Insurance

Apart from knowing the different types of insurance categories, it is important to also know the different types of insurance plans available.

One of the plans is the Indemnity plan, which normally allows one to pick his own doctor or hospital and later on submit a claim to his insurance company for reimbursement. However, unlike other plans, the indemnity plan usually settles specific medical expenses, a list of which can be found in ones benefits summary.

Health Maintenance Organization plan (HMO) usually allows one to enjoy different kinds of health benefits after paying a specified amount of money. With this specific option, an individual normally chooses a primary care physician who is affiliated with the plan to offer the much needed medical services.

Preferred Provider Organization (PPO) is another indemnity plan which normally allows one to visit any doctor at any time for treatment provided the service providers i.e. the doctors being visited agree to become part of the PPO network. Other plans which are offered by many insurance companies around Australia include POS plan or simply the point of sale plan and the health savings accounts plan.

It must be mentioned that about 3,000,000 people in Australia are insured with Medibank – the government owned insurer, and through it, they can choose between Ultra health cover,  hospital cover and extra cover. However, since these services are relatively basic and often do not cover much, people are advised to take private health cover with one of the health insurance companies.

What to Look For When Choosing

When it comes to choosing a health insurance plan, you should look at a number of things. For starters, you should look at the premiums and deductibles in place. Many insurance companies usually use different factors to determine the amount of premium to charge an individual. Some of the things which they normally look at include the person’s age and health status. If you are young and are in perfect health for example, a good insurance company should provide you with a cover which has very low premiums high deductibles in place.

Secondly, look at the coverage limit in place. A good health insurance policy should give an option of including your loved ones in the plan. In addition, the policy should be able to cover sudden medical needs such as accidents and unplanned illnesses.

Also, do not forget about the network in place. If you have a family doctor whom you like for example, find out whether they are in the network of the insurance plan you are considering before signing up for it. A good plan is the one that allows you to seek medical services from someone or a health institution that you trust.

Last – but not least, look at the drugs being covered. While many insurance policies usually insist that they cover everything, you should never leave anything to chance, especially the drugs being covered. Health insurance policy should be able to cover all your medications i.e. the drugs that you take regularly and those that you take after being directed by a health practitioner.

Generally, the health insurance policy you pick should be able to cover all your medical needs. Thus, before taking any specific health insurance policy, you should explore all the options that are on offer, find out what your health needs are and how you plan to meet each one of them through the use of the health insurance policy identified.

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About

Mich is your typical middle class guy with a house and 2 kids minus the dog. He works in the IT industry and likes to muse about how to achieve more for less when it comes to money.

1 Comment Mich on Jun 17th 2013

One Response to “Do You Know How To Choose the Right Health Insurance?”

  1. Aram Durphy says:

    I would also look to see if the provider is not for profit. For profit providers have the tendency to offer below market rates at first, and then hike them considerably in each subsequent year.