An Overview of Catastrophic Health Insurance

Health insurance is certainly one of the most important coverage plans you can buy. The cost of medical attention continues to climb, and in the event of personal injury or illness, you do not want to be left covering your own expenses.

For some people, however, a typical health insurance plan is too expensive. It may be that you only wish to protect yourself from the expenses you will incur should you require serious attention, and not wish to pay the high premiums for a policy that will cover regular lower-cost medical treatment. This is where catastrophic health insurance applies.

A catastrophic health insurance policy is one characterized by high deductibles and extremely low premiums. This means that you will pay for a larger portion of your medical expenses out of pocket, but will have small monthly or annual premium payments, and still have coverage should you require serious treatment, such as surgery.

Catastrophic health insurance, also known as a major medical program, makes the most sense if you are generally healthy and do not spend money on regular medication. It is good for young people who are not able to meet high premium payments, or healthy older people who are primarily concerned with heart-risk or cancer, and not daily medical concerns.

There are some serious drawbacks to a catastrophic health policy. You will need to pay for a great deal of medical expenses out of pocket. Because your deductible can be very high, it is possible you may pay thousands of dollars that would have been otherwise covered by a standard health insurance plan. Furthermore, most major medical plans have an established benefit cap, and once you have reached this limit in your lifetime, your policy will be voided.

There are also limits to what is covered by your catastrophic health plan. While most surgery, CAT and MRI tests, x-rays, and so on, are covered by these plans, there are medical needs such as treatment during pregnancy or treatment for mental disease that may not be covered. You will also be denied a major medical plan should you have a pre-existing medical condition. While catastrophic health insurance can provide protection for people looking to save money, or those not offered insurance by their employers, it is taking a risk that you will not incur a great deal of low or average cost medical expenses.

To determine whether catastrophic health insurance is right for you, it is best to talk to your insurance agent and get all the information. How much is the premium? Is this low enough to make the risk of such a high deductible worth it? Make sure that you can cover the entire cost of the deductible should an emergency arise. If you regularly take prescription medication, or have other regular expenses, it most likely is not as beneficial as a regular health insurance policy. Keep in mind you will have to pay the entire cost of each visit to the doctor. If you get sick often, or have a pre-existing medical condition, major medical plans are not right for you.

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