istock_000005787159xsmallEarlier this year I sat down with my insurance agent to discuss my health insurance options.  To my surprise I learned that my insurance premiums were going to go up by 30%.  When I asked her why the premiums were going up she explained it had to do with the new Obama health care plan.  Now my goal is not to bash this plan but rather to inform you that health insurance prices aren’t going down.  So in this article I’m going to share with you 3 tips to help you find the best private medical insurance policy and show you what is the best ones that I recommend in the end.

The Deductible

First off, when it comes to getting the best private medical insurance policy you need to consider the deductible you are willing to cover.  Deductibles can range from as little as $500 to as high as $10,000.  A deductible is certain dollar amount that will be required to paid up before the health insurance company will start paying your bills.

For example, if you have a $5000 medical bill for breaking your arm and your deductible is $2500 you will have to cover the first $2500 before the insurance company will pick up the remaining $2500.

So what should you do?  First off, I’ve found that deductibles between $2500 and $5000 to be more reasonably priced.  To see what I mean look at the quote I ran for a low deductible plan below.

low_duductible_planThe deductible for this plan is $1000 and runs around $147 a month.  Now lets see what happens when we go to a higher deductible.

high_deductible_planThe deductible for this plan is $5000, but notice the price has dropped to a whopping $63 a month saving you a total of  $84 a month.

Now most people might complain that a $5000 deductible is to high but their are ways to avoid this.  The first way is to add an Health Savings Account to your policy.  Also known as an HSA plan it allows you to save extra money along with your health plan and if you ever come across a medical situation you can use the money in this account to pay for it.  If an HSA option is not available for a particular plan I recommend setting up a separate emergency fund to cover this deductible if you need to.

Coinsurance

The next thing you should consider when looking at private medical insurance plans is, coinsurance.  Coinsurance is the amount of money you will have to pay once you’ve cleared your deductible.  For example, if you have medical bills of $15,000 and a $5000 deductible with a 70/30 coinsurance you would first pay your $5000  deductible.  Then you would have to cover 30% of the remaining cost of $10,000 which would be $3000.  With coinsurance the fees can add up quickly.

So what should you do?  My suggestion is to stay away from coinsurance at all cost.  The reason I suggest this is because whether you have coinsurance on your private medical insurance plan or not it doesn’t effect your premiums to much.  To prove my point below is a quote I ran with a 20% coinsurance and the second is one that I ran without.

20_coinsurance

0_coinsuranceNow obviously the plan with a 20% coinsurance is cheaper but the plan with a 0% coinsurance isn’t much more costly and can save you some major headaches down the road if you would happen to come upon to heave medical bills.

Office Visits

Finally, the last thing to consider is whether you want to have an office visit copay or not.  An office visit copay basically means that you’ll pay a specific amount or a percentage of every doctors visit you go to.  For example, if your doctor visit copay is $15, every time you go to the doctor you will have to pay this fee and no more.  Now what a lot of people assume is that if you would get rid of this benefit altogether you could save big money by not having it, but by doing so you’ll have to cover the full cost of every doctors visit.

So what should you do?  My suggestion is that if you have kids or your plan or a medical condition that you defiantly have a doctors copay on your plan.  In fact my research has shown that the price does not differ that much whether you have a doctors copay or not.  To prove my point look at the quotes I ran below.

0_coinsurance1 The plan above offers a $15 doctors copay.  Now look at the plan below everything else is the same but with no copay.

office_visite_covered_afterAgain the cost does not vary that much so why not pay a little more so you won’t have to fork out a few hundred dollars every time you have to take your kids to the doctor.

The Best Private Medical Insurance

So what is the best private medical insurance plan?  The reality is it all depends on your own situation.  Things like age, health, and even the state you live in all play a role in the cost you will pay for health insurance.  However if you follow my advice and go with a deductible between $2500 to $5000, no coinsurance, and accept doctor co-pays you might just find a program that fits your situation and avoid some huge financial mistakes down the road.

With that said here is the plan I chose.

0_coinsurance2This private medical insurance plan has a $2500 deductible, no coinsurance, and a low $15 doctors copay all for $136 a month.

Final Thoughts…

So now that I’ve shared with you some of the things I’ve learned about private medical insurance what are your thoughts?  Are their any tips that you can bring to the table that could help others save some money and find a plan that’s right for them?

Affordable Health Insurance. Compare the leading carriers side-by-side.

Questions or Comments?  Share them below.

This article was recently featured on the Carnival of Personal Finance by Stupid Cents.

About Christopher

Chris is a personal finance blogger with Stumble Forward helping people avoid life's financial mistakes and live a higher quality financial life.

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  1. [...] second thing you need to do in order to find the best private medical insurance is to consider your coinsurance options.  Coinsurance determines how much you will pay after you [...]

  2. [...] Holdheide from Stumble Forward presents 3 Tips To Getting The Best Private Medical Insurance, and says, “Learn what effects the cost of your health insurance what doesn’t and how [...]

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