What Are the Ways to Pay for Health Insurance?

Many people purchase some form of health insurance rather than pay for their health care expenses out of pocket. Health insurance provides compensation for expenses derived from medical procedures and certain kinds of preventative health measures. However, health coverage can be expensive, with annual policies often running in the thousands of dollars. Individuals face a number of options regarding who to buy health care from and how to pay for it.

Job

• Many adults who have health insurance receive it through a plan provided by an employer. Generally, health insurance is a benefit provided to employees of a particular company. In most cases, an employee pays part of the cost of the policy but pays much less than if he were to purchase the plan individually. Often, the cost of the insurance is deducted directly from the employee's paycheck.

Relative

• Often, an individual will be able to receive health insurance through a relative's plan, usually that of a spouse or parent. If the plan is provided by an employer, then the cost of covering the relative will generally be deducted from the employee's paycheck. The relative may compensate the person under whose plan she is receiving coverage or the person may make the coverage a gift.

Government

• Many people receive health insurance at little cost from the U.S. government. Federal entitlement programs, such as Medicaid and Medicare, provide health insurance to low-income people and individuals 65 and older. In addition, many state governments also help pay for insurance. Generally, the government either pays for an individual to buy from an insurance provider or the government acts as the insurer, compensating the individual for his medical expenses.

Purchase Own

• An individual also has the option of paying out of pocket for his health insurance. Individuals can approach insurers and purchase individual policies. Generally, buying an individual insurance policy is more expensive than buying coverage through a group plan, such as those organized by employers. However, people who do not qualify for government-provided health insurance and who do not have an employer who provides coverage may have few other options.