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- If you’re single without dependents, individual coverage is the best option for you
- Dual-income families have several different coverage options
- HMO plans are very popular among families who are looking for health insurance
A lot of factors come into play when trying to decide on a health insurance plan. One of the most important things you need to decide is if it’s better to have individual or family coverage. Which is better?
The answer to this question will depend largely on your family situation and what other health insurance options are available to you.
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Are you single with no dependents?
If you are single with no dependents, then individual coverage is obviously the way to go. The coverage will invariably cost less, and you will have only a single deductible to contend with.
In few cases does it make sense to take out anything other than single coverage if you do not have anyone else to insure. This is not often the case, however.
Most people faced with this decision are dual-income families, and both may have access to healthcare plans.
Is it better to have two policies, one single and one family (or two single if there are no children), or combine all the insurance into one plan?
In order to determine the best course of action for your family, you must sit down and compare the policies available. There are several scenarios that may appear, and each has a different outcome.
How do I choose the right plan?
If your spouse has the option of inexpensive individual coverage, it could be better to take out the single plan for your spouse and a family plan for your other family members.
However, family plans are simply less expensive in the long run to cover all family members. This is because of the way the premiums and deductibles are figured on family coverage.
Most companies offer several different options for coverage. For a single employee, the premium will be the lowest of all the choices.
The second option is employee and partner, which covers only two people. This type of insurance coverage usually has two deductibles to meet; one for you and one for your spouse.
The third type is family coverage, which has a set premium and a deductible for each family member.
When Only One Person has a Group Health Insurance Plan
Under the family plan, one wage earner takes out the health insurance for the entire family. In some cases, a working spouse must provide proof that he or she cannot get health insurance with their employer for less than the family premium.
Once family coverage has been obtained for the family, the premium will be calculated.
Some companies raise the premium for each person added, but most simply charge a flat rate for family coverage no matter how many dependents you have.
You will likely have to provide documentation to this effect before your dependents are covered by your plan, especially if your children are over 18.
The new “healthcare bill” raised the age which dependent children can remain on a family plan from 24 to 26, however, this only applies if your child is not married or is not covered by someone else’s plan.
How Health Insurance Deductibles Typically Work for Family Health Insurance Plans
When you have family coverage, you will have to pay deductibles for a certain number of family members before the insurance company pays any benefits.
For example, suppose your health insurance has a $500 deductible per person, with a $1500 deductible limit on families. This means that you, your spouse, and one child must each meet the $500 deductible.
After that, no other dependents will be required to meet deductibles. In most cases, once you pay $1500 in deductibles, you are then covered for all future expenses.
However, there are exceptions to this rule, so be sure you understand how your deductibles work before taking out family health insurance.
HMOs often eliminate deductibles altogether. You only have to pay a co-pays for services rendered if it is performed by an “in-network” provider. This is one of the reasons why HMOs have become a popular family coverage option.
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