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Health Insurance

Health Insurance

One of the leading topics that’s been in the news for the past several years is health insurance. This type of insurance is an important hedge against the possibility of serious illnesses. One of the leading causes of bankruptcy in the US is related to healthcare costs, but an insurance policy can mitigate many of the expenses.

Everyone would do well to insure their health. Even young, seemingly healthy people can run into health issues. These can come from acute or chronic diseases that might require one or more trips to the hospital. Additionally, young people, as well as older people, can run into accidents. No one knows when a reckless driver could cause major problems for his or her health. A healthcare policy will usually take care of much of the cost of treatment and hospitalization, depending upon the services that are covered in the policy.

Most health policies will have a deductible. This is the amount that a policyholder will need to pay out of pocket before the policy kicks in. Depending upon the policy, the deductible could be really low or quite high. Deductibles could range anywhere from $100 to $10,000. After the deductible is hit, most policies will pay a certain percentage of covered costs, usually between 60 and 80 percent. The policyholder will be responsible for the difference up to a stated out-of-pocket maximum, which will also vary based upon the policy.

Plans that have deductibles above $1,000 can also qualify for a Health Savings Account, also known as an HSA. These accounts allow policyholders to save money tax free for medical expenses. The money is not taxed when it’s saved. It’s also not taxed when used to pay for qualified medical expenses. The money can also add up over time and be a sort of retirement account once a person reaches 65 years of age.

The major benefit of a health insurance policy is risk management. A policy can help allow its holder to avoid going into massive debt over medical costs. Because medical bills are the leading cause of bankruptcy in the US, it’s a very good idea to take out a policy for this eventuality.