There’s an interesting balance between covering as much as you can with your own resources and purchasing insurance to cover potential risks that could devastate you. In my previous post, I provided an overview of how to self-insure. In summary, self-insure as much as you can, then purchase insurance for the big stuff.
When it comes to protecting what matters most in your life, your personal health needs to take precedence over everything and everyone else. When you’re not functioning at your best, it creates ripple effects across every aspect of your life. An important part of being and maintaining independence as an adult comes with self-care.
The risk of getting sick or injured is part of every day life. Being sick or injured can mean missing work as well as an increase in expenses for medication, assistance or therapy. Your health and well-being is your most valuable asset, so it makes sense to do what you can to protect it.
First, take time to know your physical abilities and limitations. Be cognizant of how much sleep your mind and body need to function at their best; know what time of the day you are most alert and energetic so you can plan activities around your personal clock. Eat well, especially foods that provide minerals and energy to replenish and restore what you use. Another way to minimize illness and injury is to keep your living area healthy. Don’t let germs and junk accumulate.
Take time to understand your options for health insurance and review each year as programs and costs change. Health Insurance policies consist of four basic parts and each one affects what they will cover and how much it will cost:
- Medical – this part dictates what illnesses/injuries/pregnancies/medical procedures will be covered and the annual/lifetime limit it will pay.
- Deductible – this is how much you are responsible to pay annually before the policy will pay. Usually doctor visits and prescriptions are not subject to the deductible.
- Co-Pay – this is how much you pay for Doctor’s Visits, Prescriptions, Exams or other specific services. Sometimes you pay at time of service, other times they will send you a bill.
- Prescriptions – this specifies annual limits and what is covered by the policy.
Most Health Insurance policies allow dependents to be covered on their parents policy until the age of 18 or 25, if they are full-time students. Some colleges require students to pay a basic medical fee to subsidize the student health services on campus. Employers may offer Health Insurance for part-time employees, but most only offer it to those who work at least 35 hours per week. It is important to compare your options, including what is available through insurance brokers. Read, research and compare.
An important piece to consider in regards to your policy is what type of “managed care plan” they use. Insurance companies partner with different managed care plans, either HMO (Health Maintenance Organization), PPO (Preferred Provider Organizations) or POS (Point of Service). Each managed care plan contracts with a specific group of doctors, hospitals, specialists, etc. in what is referred to as a “Network”. Depending on what “Network” your plan is in, will greatly affect which doctors you can use and how much you will have to pay. Networks are usually geographically determined, so if you plan on moving out of state or traveling overseas, be sure to inquire how that will affect your Health Insurance coverage.
Disability Insurance (DI) policies provide a partial replacement of your income when you cannot work due to specific illnesses or injury. You can only purchase DI if you are working and some employers offer it at a group rate for their employees. The policy usually has different options to choose from, including what % of your income you want to receive and for how long. Read the fine print, as each policy has specific rules on what qualifies for coverage and if it will pay if you also receive Social Security Disability Income (SSDI). Sometimes a good option is to have a Short-Term Disability policy that will provide coverage for 3-6 months, until you qualify for SSDI.
Besides Health Insurance and Disability Insurance, there are additional policies available such as Accidental Death & Dismemberment, Cancer Insurance, etc. I have found these to be unnecessary and expensive. Be careful not to become insurance poor.
Photo courtesy of Pixabay: Andreas