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The Big Question for Students & Graduates: Am I covered?
(PRWEB) June 3, 2000
Offered for re-print
By Creative Enterprises
Agents for Tony Novak, MedSave email@example.com
FOR IMMEDIATE RELEASE
Health Insurance for Young Adults
By Tony Novak, http://www.medsave.com
Do you really need health insurance? It seems like a reasonable question if you are young and healthy. After all, almost everyone who knows how to access the health care system is provided with basic health care services and acute care (like emergency care) in the United States, regardless of whether or not they have health insurance. Young adults tend to use health care services less often than any other group. The odds are that a young adult will go more than 12 months without any need for health care. Even among those who need health care, the likelihood of exceeding $ 1000 annual healthcare expenses is very small. So it is reasonable to wonder whether a young adult really needs health insurance at all.
But the situation changes when we consider the more extensive and more costly types of health care. The ability of a patient to obtain top quality medical care for the most serious types of health care – things like transplants, extended hospital care, physical rehabilitation, and long term outpatient care – depend more on health insurance than any other factor. Even a wealthy person will have difficulty arranging some types of medical treatments without insurance coverage. Unfortunately, if you wait until you need this type of care it will be difficult or impossible to buy health insurance that covers these items.
Often the most immediate insurance concern for young people is the fact that most colleges, trade schools, internship programs, sports teams, community-sponsored travel opportunities and many other activities require health insurance as an admission requirement. Without health insurance, you do not pass “go”. So there is usually no question about it – most young people with ambitions to advance their education need to have some type of health insurance.
There are many types of health insurance plans available to young adults. The most popular plans are listed below.
Parent’s Policy – Most students continue to be covered under a parent’s policy. If this option is available, it is almost always the best option. But most health plans require that proof of full-time enrollment be provided. Be aware of the maximum age for this benefit. In many cases this coverage will expire when the student reaches age 23 (or at another age as stated in the insurance policy).
Employer Group Coverage
Most employers provide health insurance to their full time employees and pay for most of the cost of this employee benefit. This is called group health coverage. This benefit is completely under the control of the employer. Many people do not realize that there is no requirement for an employer to provide this benefit. Most group health plans require that new employees wait a few months before becoming eligible for coverage.
Some policies are designed specifically for students. Some are portable and offer coverage to the student in any location. Others offer coverage only in the geographic area of the school and some even require that the student use the on-campus medical facilities. Most cover only full-time students as defined by the school. In general, the coverage provided by insurance plans offered directly through the school are not as good as the plans offered by independent insurance companies. These plans also cover graduate students, and are available regardless of age or health. It is work a little extra effort to find a policy on the Internet or through an independent insurance agent.
Short Term Medical Policies
Interim or gap insurance policies are available to cover from one to 12 months. This coverage is inexpensive and easy to obtain. The quality of the coverage is excellent except that it does not cover pre-existing conditions. These provide coverage in the U.S. only.
Individual Medical Policies
Permanent policies that you buy directly from an insurance company offer excellent coverage, strongest financial guarantees, and the most stability. These often provide worldwide coverage. But all this comes at a price. These policies are usually the most expensive option.
Travel Coverage / International Policies
These are specifically designed to pay for medical expenses that may be incurred while traveling overseas.
Terms to Know
Deductible or Co-payment – this is the portion of the bill that you pay before the insurance comes into play. These help reduce the cost of the insurance.
HMO – stands for “health maintenance organization”. The HMO may pay to keep you healthy, rather than only cover problems hen things go wrong. HMOs tend to be popular among young healthy people, but criticized by people receiving more serious medical care. Private physicians tend to feel that they lose control over the quality of a pateint’s care when an HMO is involved.
Indemnity plan – means that the policy reimburses you for any ordinary and necessary medical expenses. This is the least restrictive type of coverage but also the most expensive.
Managed Care – this means that the insurer has some authority to influence the type of health care you are provided. This cuts healthcare costs but may also limit your treatment.
Pre-existing condition – a medical situation that started before your insurance policy that may not be covered by the health insurance policy.
Premium – the cost of the policy, usually ranging from $ 25 to over $ 200 monthly.
Tax-deductible – reduces your taxable income and thereby reduces your total tax due at the end of the year. Most health insurance is not tax deductible by individuals.
Tax-free – the benefit provided by health insurance is usually tax-free. This means the value of the coverage received as well as any cash benefit paid as the result of a claim.
Underwritten – this means that not everyone will be accepted. The insurance company reviews each application and selects the healthiest applicants for enrollment. Premium rates are lower for those accepted, but these plans offer no solution for people with pre-existing health conditions.
About the Author – Tony Novak, MBA, MT is an adviser and writer in tax and employee benefit issues. He operates http://www.medsave.com, the nation’s leading online provider of short term medical coverage and serves under “OnlineAdviser”, a free public service for people with questions about medical benefits. His newspaper column appears in a number of publications throughout the country. He lives in Ocean City, NJ.
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