Cheap Health Insurance Plan – A Simple Way To Save Money • 05.25.09
Is there such a thing as cheap health insurance? It hardly seems possible when you look at the rise in hospital costs and physician services. Insurance companies have the task of underwriting the medical risk for insurance. The insurer then issues and delivers the policy to the insured once they are accepted into the plan. The policyholders then receive the policy declaration pages that list all of the benefits and features.
What are those benefits and features? How do they work after a hospital stay? When you begin to find the answers to those questions then you begin to understand what makes up the total premium. When you receive your first benefit statement after a hospital stay then you will begin to understand how the deductible is applied and how the coinsurance works.
Simple claims analysis
1. Total inpatient expense for 4 days in the hospital including physician services amounts to $4000.
2. Your policy has a $500 deductible with an 80/20 coinsurance clause with a maximum out of pocket $2000.
3. You must pay the first $500 for your stay leaving a balance of $3500.
4. You will pay 20% of that $3500 or $700 and the insurance company will pay $2800.
When your 20% reaches $2000 then the insurance company pays 100% of the remaining costs up to a million dollars (or 2 million etc).
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