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[H164]Health Insurance Catastrophic Coverage

by Jenna Milson, Jen

A lot of people would rather not think about illness - it is natural. But in the United States in the twenty first century you really do need to think about what might happen if you or a member of your family falls ill. If you do not have adequate insurance cover, or if you have no cover at all, you could be in deep trouble.

First of all we need to understand the whole health insurance idea. Health care is not funded in this way everywhere in the world. In Germany and France for example they have a system called an insurance scheme, but it is really very different. You pay money like in the States, but everyone in society gets a similar level of coverage. In the United Kingdom there is a tax based system that also means everyone gets the same coverage. But this is not the system we have in the US. Here there is a basic level of coverage for those on low and moderate incomes and the elderly without their own schemes. Apart from this, you get what you pay for - pay more and you get better services and more coverage.

US health insurance is not so different from auto or home insurance policies. The policy providers are businesses that need to turn a profit. For this reason people with a current medical condition may have problems getting an insurance company to offer them cover against the condition worsening. Though it might sound callous, an insurance company has to consider a person with heart problems a poor risk just like they would if you were a driver with a string of accidents looking to get a powerful car insured. This is the key incentive for getting your HMO or insurance policy on a firm footing when you are in good health. A further incentive is that HMOs often have a period at the beginning of your membership when your cover is limited - it is best that this passes when you are healthy.

Health insurance is different from automobile cover in some ways. For a start the inability to secure cover for your car would mean not driving for a while, which would be a serious inconvenience, but manageable. But not getting health care when it is needed can lead to death. The US, the wealthiest country in the world, will not just stand by as it's citizens keel over from things that can be cured. For this reason the US introduced Medicaid and Medicare - they are like fall-back cover, offering the basics. And in many states there are legally-enforceable basics that each and every insurance scheme must include. Screening in order to capture early breast cancer is an example of must-do service in most states. Take the time to find out what services are always included in your region.

The employed will normally have a company sponsored health care scheme. Problem is that the scheme often goes with the job, so a new job or the loss of the current job can mean that your family is no longer covered. Take time to understand your scheme; the inclusions, exclusions and all that. Work out a back-up plan to put in place if the scheme disappears. It's worth the time because at the end of the day our health is everything.

At the same time, insurance companies offering individual medical coverage cannot hire and train new employees fast enough to keep up with the recent spike in private health insurance enrollments. One insurer stated that they are experiencing the busiest enrollment activity in fifteen years.

Budgeting health insurance premiums into a reduced paycheck can be difficult, at best. Obviously, people need a place to live and food; however, one night in a hospital can end up costing several thousand dollars. This creates a difficult dilemma for those who are unemployed. It has been estimated that for each 1 percentage point increase in the unemployment rate, about 1.1 million are added to the rolls of the uninsured. Additionally, more than 50% of American households have cut back on seeking medical care in the past year because of concerns about the costs, according to a new Kaiser Family Foundation survey. Is there help for people?

Some relief is coming from the new federal economic stimulus package. It provides a 65% temporary subsidy to unemployed people. 1 of last year through the end of this year. But a problem for many is that COBRA can be prohibitively expensive. Under law, workers must pay the entire premium, plus a 2 percent administration charge. On COBRA, family coverage averages $13,000 a year. Even with the 65% subsidy, it may not even be an option for someone who is out of work. In many cases, private medical insurance offers a significant savings over a subsidized COBRA option.

Since President Obama signed into law the $787 billion economic recovery effort last month, employers, laid-off workers, state officials and benefits attorneys have been scrambling to figure out the details of the very broad provisions that are designed to help the growing number of jobless workers continue health coverage. There is a great deal of confusion regarding the stimulus package. Generating a lot of heat at the moment is the fact that to qualify for the subsidy, you must have lost your job between Sept. 1, 2008, and Dec. 31, 2009. People who lost their jobs earlier have been excluded. The limitations appear to be a concession to limit the overall cost of the subsidy program.

The stimulus package was released so quickly; Unsurprisingly there are more with questions than answers. Over the coming weeks, the U.S. Department of Labor is expected to release further clarification. Additional guidance is also expected from Health and Human Services as well as the Treasury Department.

In the meantime, if you aren't eligible for the new subsidy, there could be another way to subsidize COBRA coverage. If you lost your job because of competition from exports or overseas outsourcing, the government will pay up to 80 percent of COBRA premiums through the Trade Adjustment Assistance Reform Act. Under this law, you can receive monthly payments or a year-end tax credit to offset COBRA premiums for up to three years". The subsidy already was available before the stimulus bill passed, but the new law boosts the subsidy rate from 65 percent to 80 percent.

If you're not eligible for any COBRA subsidies, look into other plans as a COBRA alternative. Can you join your spouse's employer-based health plan? Can your state insurance department or county health department tell you about any state or local programs to provide affordable medical coverage? Veteran's benefits may also be an option.

If none of these avenues work for you, look for an individual health insurance plan. It is possible to find lower premiums than those available on COBRA.

Article Source : Medicare Benefits

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Both Jenna Milson & Tom Carolan are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.

Jenna Milson has sinced written about articles on various topics from Health Insurance. . Jenna Milson's top article generates over 1300 views. to your Favourites.

Tom Carolan has sinced written about articles on various topics from Finances, Health and Health Insurance. BestHealthcareRates.com has helped thousands of individuals, families & businesses find . Providing free research tools & health insu. Tom Carolan's top article generates over 9900 views. to your Favourites.