Many individuals resort to purchasing catastrophic health insurance when they can not afford a regular full coverage insurance policy. While some may view this type of insurance as a burden, due to the out-of-pocket expenses, it can actually be a blessing. Catastrophic health insurance allows you to see what you really pay for your health care.
The Problem With Full Coverage Insurance vs. Catastrophic Health Insurance
If someone were to give you their credit card, tell you there was no limit on it, and you could spend as much as you wanted in an effort to renovate your entire house, what would you do? You could do anything you wanted, like purchase new furniture, replace your carpeting, and install new plumbing. Even if you used the credit care on only practical items, the fact that someone else is stepping up to pay for everything is going to greatly affect your choices.
That leaky faucet in the kitchen you have been dealing with for the last ten years could be fixed, along with that hole you made in the wall when you first moved your couch into the living room. If you had to pay for these expenses, you might not spend the extra money on these problems.
Full coverage health insurance works the same way. You are given a small co-payment or co-insurance, of course, but after this small payment and your deductible, your entire health care costs are placed in the hands of a third party. You have no idea what the insurance is paying for. All you know is it is being paid by someone else, and, like most individuals, you don’t worry about the overall cost.
With catastrophic health insurance, you are given a chance to truly see what your health care costs. This gives you the opportunity to make an informed decision about whether you really need to visit the doctor or not.
Catastrophic Health Insurance – The Hidden Costs of Health Care
If you have purchased catastrophic health insurance, chances are you are a little more frugal with use the health care system. You may only go to the doctor for yearly check-ups or when you are really and truly sick, because you have to pay for this expense from your own pocket.
It probably never occurred to you, though, that you may be spending a lot less on your catastrophic health insurance than those who are fully insured, did it? Money.cnn.com produces some staggering statistics on the amount of money individuals actually pay for health care.
- The hidden costs of health care add up to about $363 billion. “Hidden costs” often refer to time spent off work, caring for loved ones who are sick, ambulance services, alternative medicine, and nutritional products.
- This averages out to about $1,355 per person, which is added to the already estimated $8,000 every individual spends on health care.
- The average income in 2010 dropped 1.9%, while the cost of health care increased 6%.
Is Catastrophic Health Insurance the Answer
Catastrophic health insurance means lower premiums and care for when an unexpected event occurs in your life. With catastrophic health insurance though, you are in charge of the rest of the care you need. You get to decide if you truly need to visit the doctor for that runny nose or if you can just tough it out with a little cold medicine.
So the big question is: Would you spend less on your health care if it meant you had to pay for it yourself? Would you pick what care you needed instead of running to the nearest doctor’s office every time you had a little cold, just because someone else was paying for most of the bill? When individuals pay for their own care, they are more likely to be conservative and spend less.
With catastrophic health insurance, you could not only save money through low monthly premiums, but save money on a much larger scale by reducing the amount of health care you receive.
For more information on catastrophic health insurance, hidden costs, and how catastrophic health insurance can meet your needs, continue to follow our website.