No matter what you buy, there will always be a correlation between price and benefit. Whether it’s a pair of shoes, a car or even a new dishwasher – anything that sounds too good to be true, usually is. Cheap health insurance is no different. When it comes to insurance, there are no bargains.
Cheap insurance is priced that way because it’s designed to give you very little back in return. One of the things to watch out for when you are researching some low cost health insurance policies is their rating. A low rating of C- or lower means there are questions as to whether the company could stay in business if it needed to pay out too many claims all at once. Many insurance companies over the years have gone out of business due the number of claims.
One reason their insurance might be cheaper than others is the way they reimburse doctors who have contracts to work for them. Since they pay their doctors below average rates, they can pass this savings on to their customers.
All insurance companies need to manage their risk level. They are in business to make money; paying claims is something they do because they are obligated to but they want to do everything they can to deny claims. Cheap insurance companies have become experts in finding ways not to pay claims. They may not be able to.
Also check out the doctors who are associated with these cheap insurance companies. There’s a reason they are willing to work for below industry reimbursement rates, and it’s up to you to research them and find out why that’s so. At least make sure you can use a doctor with credentials from a US medical school.
In most cases, the deductibles for all policies are very high. If you have children who are accident prone or if you have problems that need medical supervision, this type of insurance may be more of a hindrance than a help.
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categories: student health insurance, low cost health insurance, health insurance information
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