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Supplemental Health Insurance in California

What Is Supplemental Health Insurance And Why One Policy is Not Enough

In an age where there are so many uninsured and to have health insurance cover of any description is a sign of good fortune, it may seem odd that supplemental health insurance is an issue of some importance. However, health insurance is a topic of wide proportions and many considerations collide in the process of its provision.

The Medicare program for instance is delivered in two parts. Part A provides basic health care and is invariably free for qualified individuals. Part B however is not free, and for $93.50 per month the beneficiary is able to receive cover for outpatient care and additional medical services and supplies.

Every health care service that may be envisaged or indeed required by an individual is not covered by Medicare, and in this event, the individual seeking coverage in these specific areas needs to purchase a private health insurance policy to complement the Medicare coverage.

For example, Medicare recipients pay a monthly premium and with an annual deductible that is relatively low and approximately $250. After that amount has been reached, Medicare pays 75% of prescription drug costs up to $2 250. Then there exists a gap, known as the 'doughnut', where the recipient then pays the costs till $3 600 is reached in out of pocket expenses.

At this point, Medicare pays 95% of prescription drug costs for the remainder of the year. However, for individuals meeting eligibility for low income testing, the deductible is waived and no gap in coverage exists.

MediGap Coverage

Individuals with privately purchased supplementary health insurance to cover the gap in Part B of Medicare coverage have been found to have higher expenses than those who had employer provided policies, and even where adjustments have been made to account for the differences, this illustrates the precious nature of employment based health insurance and also the increasingly problematic cost of publicly funding health care insurance without a universal system in operation.

Still, the fact that employer based health insurance cover is a benefit with a definite financial value and yet escapes the net of taxation, means that it is in effect subsidized by taxation as it is monetary value that would otherwise be subject to tax liability. When rationalized in this fashion the differences between expenses through a private health insurance policy or through an employment based policy tend to converge.

Compare Best Supplemental Health Insurance

When choosing the form of supplementary health cover to purchase, the individual has the choice of obtaining health cover in the 'fee for service' or indemnity insurance market, in which the recipient retains the right to choose the health service provider of their own choice, or they may choose to purchase a managed care policy such as one of the health maintenance organizations (HMO's) which require a choice to be made between a limited number of preselected health service providers. For this later type of health insurance the recipient will receive a broader range of coverage for only a little additional cost.

 

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