by Guest » Mon Apr 12, 2010 09:25 am
I'm an young adult. I'm not sure if this is the right age to think of health insurance, but still I'd like to know if it's the right time to go for it. Are there any cheaper health insurance options? Where do I find it?
Posted: Mon Apr 12, 2010 08:26 pm Post Subject:
A health savings account combined with a high deductible health plan would probably make the most sense for someone your age, providing you faithfully fund the HSA. Fail to fund the HSA, and you're better off on Medicaid.
Premiums for both PPOs and HMOs for healthy young persons in many major metropolitan areas are well under $100.
Stay away from the "discount" health plans ("get up to 40% off your doctor bills") -- they are an utter waste of money.
Find a local agent and discuss the options. Then find another agent and do the same. Make an informed decision!
Posted: Tue Apr 13, 2010 02:27 am Post Subject:
Max, good post.
HSAs can be great for younger people without any real health concerns. Fund the savings account "faithfully," as you put it, find a decent "high deductible health plan (HDHP) and this should work.
Keep in mind, the minimum deductible (in 2010) for an individual enrolling in a HDHP is $1200 and for a family plan, $2400. As well, the maximum contributions to the HSA are limited to $3,050 for an individual and $6,150 for families. If you're 55 or older, it has a "catch-up" provision that allows an additional $1,000 contribution. The HSA grows tax-deferred and has completely tax-free distributions if used for qualified medical expenses (which is a whole lotta stuff, including the premiums for the HDHP, the deductible, any co-insurance or copays, etc.). The HSA can "roll" from year to year; you don't forfeit the funds at the end of the year as you would in an FSA.
Unqualified distributions are taxed and subject to a penalty of 10% if made prior to age 65.
I would never suggest the plan for anyone with a chronic medical condition or for most older people, as the "holes" can potentially eat you alive. There are maximum out of pocket costs associated with an HSA plan: $5,950 for an individual and $11,900 for a family. $6k is a chunk and you're subject to the insurance contract as to coverage. If you have an individual HMO or PPO, you can commonly get max. out of pocket at significantly smaller levels. Not always, but you can.
The idea of HSAs was, given the high deductible, was to reduce the premium costs for the insurance plan and give the insured the ability to "save" money in a tax-advantaged environment in order to control more of his health costs. All of these plans are euphemistically referred to as "Consumer Driven Health Plans," or CDHPs. The reality is that in many areas of the country, the premiums are quickly approaching those of the traditional medical expense plans.
Gee...who woulda' thought that would ever happen...
Ahhh, but I babble... argue away on the merits or lack thereof.
InsTeacher 8)
Posted: Tue Apr 13, 2010 10:56 am Post Subject:
Stay away from the "discount" health plans ("get up to 40% off your doctor bills") -- they are an utter waste of money.
Why do you think like that? Don't these plans pay for our bills? What could be the "catch" about such plans?
Posted: Wed Apr 14, 2010 07:37 am Post Subject:
If you're an young adult, you could try and achieve health insurance from your school. I'm sure you could save some money while using the medical care option.
Posted: Wed Apr 14, 2010 08:08 am Post Subject:
In my opinion the younger you're the more benefit you will get from health insurance. Since, I'm not in US, you'll need to ask someone from the same country as you are.
Posted: Thu Apr 15, 2010 06:49 am Post Subject:
Yes, the medical care offered in your college could be of great help to you. On the other hand, you may check out different insurance carriers who're offering discounted health insurance to a lot of students like you.
Posted: Fri Apr 16, 2010 01:47 am Post Subject:
Stay away from the "discount" health plans ("get up to 40% off your doctor bills") -- they are an utter waste of money.
These plans are NOT health insurance. These are memberships in organizations that charge $40-$50 per month and give you a list of doctors that will accept lower fees for cash-paying patients.
Guess what? ALL physicians have lower fee schedules for cash-paying patients. All you have to do is ask. You don't need to pay a third party $40-$50 per month for that privilege.
Too many people have fallen for the low price, only to discover later that it's not insurance. I've had clients who dropped their health insurance and gotten involved in one of these plans, only to suffer the financial consequences because they were misled into believing they were getting something equal to their insurance for 1/3 the cost.
Caveat emptor.
Posted: Fri Apr 16, 2010 05:16 am Post Subject:
All you have to do is ask.
That's great information Max. I understand that all physicians have lower fee schedules. But, is it gonnabe lowered by the same percentage as it's gonnabe lowered by paying a third party?
Posted: Fri Apr 16, 2010 08:33 am Post Subject: health insurance for young
Today's young adults are bold, determined and many believe that they are unable to get sick. Unfortunately, that is as far from the truth as one could get. While young adults won't be experiencing hip replacements or heart surgery, there are a range of things that can go wrong in a body of any age.
So health insurance is very important for young .
Posted: Fri Apr 16, 2010 02:59 pm Post Subject:
But, is it gonnabe lowered by the same percentage as it's gonnabe lowered by paying a third party?
Yes, if not more. A few physicians pay money to those same companies to be on their lists. Don't you think they'd want to recover that expense?
Some physicians may even be willing to accept the same or slightly more than they already get from HMOs and PPOs with whom they have contracts, which is practically nothing. You just have to ask.
Doctors and hospitals have a "don't ask, don't tell" policy when it comes to billing issues. You'll never know what they'll accept if you never ask.
But you don't have to pay someone good money for a list that may not even be accurate. These plans have come under intense scrutiny by insurance regulators in many states.
In my book, they are in the same category as the bogus auto repair "warranty" solicitations that you get by mail.
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