From the course: Risk Management and Insurance Planning: Designing for Client Needs
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Private health care plans
From the course: Risk Management and Insurance Planning: Designing for Client Needs
Private health care plans
Let's talk about the cost structure and the delivery of healthcare insurance plans. There are two major cost categories to consider when estimating healthcare costs – premiums and out-of-pocket costs. The premium is the regular payments paid to a health insurance company to access a health insurance plan. The amount of the premium will vary inversely with the other costs, which means that a plan with a low premium will likely mean that the plan will have more out-of-pocket costs. People that are healthy and do not foresee a need for healthcare in the upcoming year may choose a plan with a lower premium. The second category is called out-of-pocket costs, and there are four different costs to consider. One is deductibles. A deductible is the amount of money a person needs to pay each year out-of-pocket before the insurance plan will start to cover any expenses for medical services, appointments, or prescriptions. In most plans, even after the deductible has been paid, the insured will…
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