How To Avoid A Major Cause Of Bankruptcy By Getting Basic Health Insurance Coverage
Published 1/7/08 (Modified 3/8/11)
This post is for people like me who used to live life without even the most basic of health insurance coverage. Did you know one of the major and perhaps number one cause of bankruptcy in the United States is unanticipated medical bills caused by inadequate or even complete lack of health insurance coverage? Currently, unpaid medical bills due to unforeseen and catastrophic medical related ailments compete with debt mismanagement and credit card bills as the number one contributor to personal bankruptcy.
We all make many important financial investments in our lives, but believe it or not, health insurance might be one of the most important. It's a silent safety net that will catch you in the event the worst happens and will prevent you from completely falling into the financial abyss. Without at least basic coverage, having to fully pay all of the medical costs out of pocket can be very expensive and difficult. Just a single night's stay at a hospital for emergency care can cost upwards of thousands of dollars. Without at least basic coverage, you are one appendix or broken leg away from a pile of insurmountable medical bills.
While today's basic entry level premiums do not offer full financial protection from serious illnesses, having basic coverage will at least cushion the burden to a more manageable degree. It's important to maintain a healthy lifestyle by eating your fruits and vegetables and exercising regularly, but sickness and physical accidents are inevitable in life. You might get lucky for a long time but eventually the odds will turn against you when you least expect it.
Apply For Health Insurance Coverage That Fits Your Age, Health Condition, and Family Size
The amount of health insurance coverage needed depends on many factors including the age of the person, overall health status, as well as the number of family members and other dependents relying on the person for financial support. While many people have health insurance coverage through their employers, not all of us are that fortunate, myself included. I performed contract work in the past so during those periods of time I didn't always have employer coverage. However, I always made sure I purchased my own basic plan.
Perhaps you are self employed, a college student, a recent graduate, or maybe you are working for a company that doesn't offer a discounted group policy. Whatever the reason, it's imperative that everyone at least go out and obtain a basic level of coverage. Medical disasters can strike when you least expect it and financially wipe out your existing savings. Don't gamble with your family's health and financial livelihood. Basic coverage is easily available, particularly if you are willing to settle for a higher out-of-pocket deductible plan. We all have enough on our minds everyday to worry about - don't let your lack of basic health insurance coverage be an issue.
Buying Basic Health Insurance Coverage On Your Own
When I did contract work (essentially temping), I was not insured by my employer, so I went out and purchased health coverage on my own. Fortunately, coverage for a healthy person in his late 20's was reasonable, so long as I was willing to take on a high deductible plan with a higher out-of-pocket requirement. The insurance plan I purchased was through Care First Blue Cross Blue Shield with a deductible of $5,000, total out of pocket expense requirement of $6,000, co-insurance of 20%, with a monthly premium of $49.00 a month. Yes my deductible was high, but for a healthy, relatively young person like myself, it was more than adequate to protect myself from possible financial catastrophe and even bankruptcy risk.
There are many ways to buy health insurance, but the easiest way is to do it online through an insurance broker such as eHealthInsurance or InsureMe. I requested quotes from many sources, but ultimately chose to obtain my health insurance package through eHealthInsurance. Their prices were affordable and adequate to suit my basic coverage needs.
Open A Health Savings Account To Cover Unreimbursed Expenses Of Your Basic Health Insurance Policy
For those with high deductibles, I also suggest opening a tax advantaged Health Savings Account (HSA) to compliment your insurance plan. Your tax free contributions towards your HSA are either pre-tax or you can make deductions when you file your taxes. The amount you contribute can be accumulated and rolled over from year to year and be used to pay for qualified medical expenses as well as unreimbursed medical costs like deductibles, co-payments, and other services not covered by insurance.