Medical emergencies arrive unannounced. With the rising healthcare costs, the hospitalization and treatment expenses can leave a big dent in your savings kitty. Health insurance is your financial cushion against all medical expenses. You simply can’t live without health insurance in this country.
However, buying the right medical insurance plans could be tricky, especially when there’s absence of a full-fledged healthcare marketplace due to the gradual meltdown of Obamacare. But, if you’re insured through your employer or can afford to enter the private health insurance marketplace then there are a number of plans in the market that could leave you baffled with their variants and features.
Here is your handy guide to selecting the best health insurance plans
Understand Your Health Insurance Requirements
The personal factors such as age, lifestyle, occupation and medical history play a significant role in determining the coverage amount of the health insurance plan.
For example, if you are a young person who has zero medical ailments and doesn’t have poor lifestyle habits like smoking/drinking, you can opt for a lower coverage.
On the contrary, if you are above 40 years of age, have a pre-existing disease like diabetes or are exposed to occupational hazards, you will need a higher coverage.
Your spouse, kids, and parents are also prone to common health risks as well as hereditary diseases. So, it is always advisable to buy a family health insurance plan.
Moreover, a family plan is available at a cheaper premium than an individual plan.
Do Market Research
Do not rely on the advice of your friend or colleague, or be lured by advertisements. Do your homework across various medical insurance plans offered by different insurance companies.
Compare the benefits and features of all plans according to your health insurance needs. But, don’t be fooled into buying a policy with the cheapest premium.
Always go with the plan that offers adequate coverage and extra benefits, even if it means paying a higher premium. It is also necessary to compare the insurance companies on the basis of their reputation and claim-settlement ratio.
Study the Scope of the Plan
Look for the following features in a health insurance plan:
- The number of common ailments, critical illnesses, and surgeries covered. A good insurance plan is one which includes the maximum number of diseases and conditions, including Maternity and childbirth care and dental treatment.
- AYUSH (Ayurveda, Yoga and Naturopathy, Unani, Siddha, and Homoeopathy) treatment expense coverage.
- Hospital room rent expense coverage.
- Domiciliary (home health care) hospitalization coverage.
- The minimum period of hospitalization to avail the claim. This is usually 24 hours, but with certain surgeries; it may take lesser time and can be covered during daycare and OPD treatment. So, check with the insurer if it provides coverage for hospitalization lesser than 24 hours.
- Types of pre and post hospitalization expenses covered.
- Daily cash allowance.
Exclusions and Sub-Limits/Co-Pay
Go through exclusion clauses as well. Certain treatments such as cosmetic, HIV/AIDS, bariatric or medical expenses incurred owing to terrorism, war, nuclear blasts, and riots may not be covered.
Sub-limit or Co-pay is the highest cap on an expense you can claim under the plan against the sum assured. For example, if the sum assured is Rs7 lakhs and sub-limit on ICU room charges is 2%, it means that you can claim up to Rs. 14,000. If the actual charge is more, you will have shell out from your pocket.
You should choose plans which have minimum exclusions and maximum sub-limits.
Waiting Period and Pre-existing Diseases Clauses
These are two very important clauses you must study in a health insurance plan. Otherwise, the very purpose of taking medical insurance will be defeated.
The waiting period is the duration of which you cannot claim any benefits. Even if you do, the insurance company will not accept it. The waiting period differs from one company to another.
A pre-existing disease is a medical condition, injury or ailment which you already have or was discovered within 48 hours before taking the plan. The waiting period for claims on medical expenses related to pre-existing diseases is usually 2-4 years.
You should opt for plans which have a minimum waiting period.
Network of Hospitals and Cashless Claim
Every insurance provider has a tie-up with hospitals to help an insured person or his family with hassle-free claim settlement.
Go through this list and see if the hospitals in the area you reside or visit the most are covered. Also, check for outstation hospitals in case the insured person needs hospitalization or treatment there.
Another benefit of hospital network is cashless claims. As soon as hospitalization takes place, you can inform the insurance company and request for cashless settlement.
This means that all the paperwork related to bill payment will be directly taken care of by the insurance company. However, do make sure that the health insurance plan includes cashless facility.
Maximum Age Renewal
Do note that health insurance plans have validity for only one year. They need to be renewed every year. As you age, the choice of plans reduces because you are more prone to health hazards.
It is advisable to choose a plan which offers maximum age renewal meaning you should be able to renew it until the age of 75 to 80 years. However, this age again varies across insurance companies.
Most health insurance buyers are apprehensive about medical tests. However, this is an integral part of the entire process. The good news is that medical tests are usually conducted only for people above 40-45 years or with higher sum assured of 8-10 lakhs.
The tests are conducted at the clinics/pathology labs that have a tie-up with the insurance company. Find out if the insurance company will bear the cost and if yes, how much.
Health insurance plans give you the financial peace of mind while the health contingencies take a physical and emotional toll. In order to get the right plan and minimize the chances of rejection, make sure that you are honest about your health details.
Anil Kumar says
What to do if I don’t have enough time to perform market research?
Interesting, you’re saying you don’t have time to try to save money! My friend you’ll get time and you’ll love it when you start out