The Best Catastrophic Health Insurance

As the cost of health insurance increases exponentially, more and more consumers have been forced to sacrifice comprehensive policies in exchange for less expensive ones that provide less protection. Catastrophic health insurance policies are available from most major insurance companies, and each carrier may have multiple variations of these products to suit your specific needs and budget.

What is Catastrophic Health Insurance?

• Catastrophic health insurance only provides benefits for serious and severe medical situations. Many services ordinarily covered by health insurance plans are typically absent from catastrophic policies. Fees for routine office visits, X-rays, lab work, and even prescription medications may be excluded from these plans. Benefits are typically only available for emergency visits, surgical procedures, and associated services.

Deductibles

• Most catastrophic health insurance plans contain very high deductibles, often in the range of several thousand dollars. Deductibles allow insurance carriers to keep monthly premiums lower. However, when covered treatment is rendered, you are responsible for paying the deductible portion of the total cost, and the insurance company pays the remaining balance.

EPO Plans

• Many states allow insurance carriers to offer Exclusive Provider Organization plans, or EPOs. These plans provide only the most basic medical coverage and are considered catastrophic benefits policies. Major medical issues are covered, as are emergency services. Some EPO policies cover one or two office visits for ordinary check-ups and physicals, but not every plan contains this feature. Most EPOs require large deductibles, typically between $2,000 and $5,000.

Considerations

• If you're considering the purchase of a catastrophic health insurance plan, carefully evaluate the cost versus the benefit of such a policy. Examine your existing financial resources and determine your ability to pay the plan's deductible if you ever need treatment. Buying catastrophic health insurance might make sense if you're a relatively healthy person with a limited budget, and you work in a physically safe environment. On the other hand, if your job or hobbies put you at an increased risk of injury, or if you easily succumb to sicknesses and other ailments, this type of plan may leave you with greater expenses than if you purchased more comprehensive coverage.