Health Insurance policy is mandatory for every individual in a majority of countries, including the USA. Insurance help people cover extremely expensive medical services and prescribed drugs, while Insurance companies earn from monthly premiums individuals and business owners pay for the policy.
There are numerous different Health plans for every need: some companies offer the fixed list of doctors and hospitals people can attend under the definite policy, while other Insurance companies provide clients with the policies that allow unlimited choice of medical services and doctors. Everything depends on how much money you are ready to spend on your monthly medical support and whether you really need a regular medical care.
Of course, it is not reasonable for a young healthy individual to pay to Insurer the same amount as elderly people (who need constant medical help and check-ups) pay. This is why a special Catastrophic Health Plan was developed.
Who is Catastrophic Health plan designed for?
It is specially designed for individuals with a strong health and no pre-existing conditions (typically, people under 30). In order to let young people reduce their Health Insurance expenses, Catastrophic Health policy covers only extreme and urgent medical issues that are supposed to happen rarely.
For example: a 25 years old male with no health issues and no pre-existing conditions got injured and require immediate medical help. In this case, both he and his Insurer cover expenses where a person covers up to 50-80% of medical help cost, and the policy covers the rest.
In that way, young and healthy individuals have no need to pay for “nothing” if they do not need to visit doctors regularly. It is supposed that typically some unforeseen and catastrophic issues can appear when it comes to young people without chronic illnesses. Therefore, there are no reasons for them to pay monthly premiums for the standard list of medical help other people may regularly need.
Another category of people who can get a Catastrophic Insurance policy is people with lack of income, so they can’t afford a typical Health policy but they are not allowed to stay without Insurance at all.
Those are usually people who recently went through bankruptcy, also homeless people and people who officially don’t have enough means for simple necessities.
Pros and Cons of Catastrophic Health Insurance
The biggest advantage and the prime reason why people want to get a Catastrophic Insurance plan is considerably lower premiums. One can save the large sum of money on cutting monthly premiums, if they don’t need a regular medical check-up and care.
On the other hand, when serious and unforeseen health issues occur, it always means a very high medical bill, so without the policy a person may go bankrupt by paying such huge expenses. The catastrophic plan covers a part of these expenses which is the reason why this type of policy is considered obligatory for those who don’t want a standard Health policy.
Above all, some types of Catastrophic Insurance cover not only emergency care, but quite a big range of standard medical services.
Along with paying less for monthly premiums, a person pays seriously higher deductibles in a case of medical help is needed. Even if the Catastrophic Insurance policy will come in handy twice or once a year it will obviously be a serious issue (an accident, a bodily injury or complicated trauma), so the final bill is going to be very high anyway.
Not all catastrophic plans cover usual medical services apart from emergency issues. Thus, if someone without a standard Health Insurance will need to visit a doctor for check-up or analysis, they will pay all expenses from the own pocket.
Since we have figured out that Catastrophic Health Policy can be highly beneficial for certain categories of people, the question is – is this type of policy available for anyone? The answer is No, as if it were available for anyone, everyone would get this, the cheapest type of medical plan. There are several strict requirements to eligibility.
Here are the qualification criteria:
- A healthy (with proven medical record) individual under 30 years. One must have no chronic illnesses.
- People of any age who are in a category of hardship exemptions: these are people who, due to any reasons, cannot get a standard medical care plan.
- Individuals whose policy was cancelled by the employer or the Insurer itself.
- People who can’t establish a Health Savings account.
All the details about meeting the guidelines for hardship exemption you can find here https://www.healthcare.gov/health-coverage-exemptions/hardship-exemptions/.
There are several alternatives to Health Insurance, and some of them are pretty good in terms of the number of medical services a person has an access to.
Groups of people (or families) create a medical cost-sharing community in order to commonly pay bills of each community member when someone needs medical care. An individual who requires medical services pays only deductibles, depending on the type of med care.
Christian Health Share Ministries
These are non-profit Christian Health organizations, providing the full range of medical services to groups of people (Christian families) who share all bills and medical costs of each member.
Medical Services discount card
This card could become a great solution for those who visit doctors from time to time and prefer to pay cash. Instead, a person receives a significant discount for all medical services.
The biggest plus of Medical discount card is that people may choose any doctor from any hospital, without being limited by a list provided by an Insurer.
Direct Primary care
It works the same way as a gym membership card, where a person or a family buys a right to visit a doctor or a hospital any number of times during a certain, fixed period. It’s the best alternative to traditional Health Insurance for big families with many children who need to visit doctors often.
A Catastrophic Insurance plan is an excellent solution for those who are young and in a good health, so they don’t need regular checkups. It saves money by cutting monthly premiums expenses, but the sum of deductibles is much higher than for standard Health Insurance.