Health Insurance

You’re young and probably in the best health you’re ever going to be, but don’t be fooled into thinking you don’t need health insurance. One bad auto accident or serious illness can ruin you financially, especially if you’re self-employed or work as a freelancer. How much health insurance do you need, and what kind?

The first step is to calculate how many times you visited a doctor, walk-in health clinic, or emergency room over the past year. If you didn’t go very often, was it because you weren’t sick or because you didn’t have the money, so you toughed it out at home? Do you take prescriptions regularly? Insurance policies vary on prescription coverage. Even if you haven’t needed health care often, are you planning changes, such as starting a family?

Then calculate how much you’re willing to spend on health insurance. Many employers no longer offer health insurance as a fringe benefit – but if yours does, it will probably be your most affordable option. If you are married, compare the policy to your spouse’s coverage. It might be cheaper for both of you to be on one policy.

The Affordable Care Act allows you to stay on your parents’ insurance until you reach age 26; then you have 60 days to find your own plan. The government website
HealthCare.gov (and its Facebook page) is a good place to start looking, as is the private eHealth.com.

Options include high-deductible, low-premium policies, for people who don’t think they’ll need health care often, and low-deductible, high-premium policies for people who expect to use insurance more often. Another possibility is catastrophic medical coverage, which has extremely low premiums but very high deductibles. As the name implies, this kind of plan covers only major medical emergencies – the kind that can throw you hundreds of thousands of dollars into debt – but not routine doctor visits.

Your health insurance requirements and options change at age 26 and at age 30

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