Different Types of Health Insurance in California

Whether you buy group or individual health insurance in California, the options you have regarding the different types of health  insurance are generally the same.   In some groups you can even choose from available plans. These different types are  <strong>traditional health insurance, health maintenance organizations (HMOs), and preferred provider organizations  (PPOs).</strong>

California goes beyond the Federal requirements for offering health insurance to its residents.  Examples of this include Industry  Advantage plans (IAHP), short-term health policies, Insurance for high risk Individuals and special plans for children and teens.

<strong><u>Additional Health Insurance in California</u></strong>
The traditional health care delivery system is based on a fee-for-service type of arrangement. In a fee-for-service system, you pay  or each itemized medical service you receive. In the days of the frontier, "Doc" often received a chicken as payment. Today,  physicians are paid with money, lots and lots of it. Fee-for-service health insurance recognizes this practice and is designed to  reduce or even eliminate your duty to pay directly for your medical care. Traditional health insurance comes in three parts:

<strong><u>California has four basic options for choosing a health care plan:</u></strong>
<ol>
<li>1. Health through an employer or association</li>
<li>2. Health Insurance through Income eligibility such as Medicaid</li>
<li>3. Health care for high risk individuals such as those that have had cancer or a heart attack</li>
<li>4. Private Insurance</li></ol>

<strong>Hospitalization</strong>
Hospitalization covers defined expenses incurred while in the hospital. Generally, the insurance will pay for all of the covered  services rendered by the hospital staff. However, if the insurance benefit is an indemnity payment, the payment will be for a fixed  sum regardless of the actual expenses incurred. This fixed sum will usually be far below the daily charge actually made by the  hospital.

<strong>Medical/surgical</strong>
This part of a traditional health plan covers the expensive costs of medical care other than the bill from the hospital. Services  such as doctor visits, treatment charges, etc., are covered here. Medical/surgical usually has a deductible and requires  co-payments by the insured (payments you make for charges not covered by the insurance), typically 20 percent of the doctor's fee.

<strong>Catastrophic or major medical</strong>
There are usually lifetime maximum payments that hospitalization and medical/surgical plans will pay, after which the well runs  dry. Unfortunately, these maximums may not be sufficient to pay for all of the care required if a major illness or injury should  strike, since such afflictions can eat up hundreds of thousands or even millions of dollars worth of health services. Thus,  catastrophic coverage adds to your umbrella of protection in an amount sufficient to protect you from the horrendous expenses of  such serious and prolonged illnesses. These policies also fill in some of the gaps not covered by hospitalization or  medical/surgical.

<strong>Health Maintenance Organizations or Private Insurance in California</strong>
The health maintenance organization (HMO) is a relatively new player in the health insurance game, although it has been around in a  limited fashion since the 1930s. The idea behind an HMO is to pay one premium and receive all of your health care at no or a  nominal additional cost. The point is to save money compared to traditional health plans that cost more to purchase and require  more out-of-pocket payments from the insured. What you, the insured, give in exchange for reduced cost is a substantial loss of  your freedom to choose who will take care of your health needs.

<strong>Preferred Provider Organizations</strong>
Preferred provider organizations (PPOs) seek to give both the benefits of traditional health plans and the money savings of HMOs.  They do this by paying higher benefits as a reward for your using the doctors or hospitals they preselect for that purpose.

<strong>Disability Insurance</strong>
Disability insurance does not pay for health care; rather it pays for lost wages caused by a disabling injury or illness.

<strong>How Health Insurance Is Priced</strong>
Ask anyone how health insurance is priced and you will get a simple answer: expensively! Beyond that, there are underwriting  criteria used by health insurance providers, whether they are for-profit or, like Blue Shield/Blue Cross, nonprofit.

<strong><u>Underwriting Criteria</u></strong>
<strong>Age</strong>
The older you are, the more likely you are to get sick; therefore, the higher your health insurance premiums will be.

<strong>Number of people covered</strong>
Many people buy family coverage rather than individual policies. This means that there will be adults as well as minor children  protected by the same plan. Some companies will charge based on the size of the family. Others charge a basic family rate without  regard to the number of members.

<strong>Gender</strong>
Unlike life insurance, where women get the better end of the bargain than men, in health insurance women often pay higher premiums.  This is based on health insurance industry statistics which indicate that the female of the species tends to need medical care more  often than the male.

<strong>Health history</strong>
Insurance operates on statistical probabilities. If you have had a poor health history, statistically you are more likely to have a  more expensive health care future. This, in turn, means that you will pay higher premiums-if you can get health insurance at all.

<strong>Occupation</strong>
The more likely you are to suffer injury or illness because of the work you do, the more likely the health insurance industry will  be to charge excessively for benefits. This may be well and good for professional deep-sea divers.  But the industry has begun to  stretch the concept into areas that have nothing to do with the inherent danger of the work.

<strong>Lifestyle</strong>
In your application for health insurance you will be asked questions about your personal habits. Your answers will have a lot to do  with the cost of your premiums. If you smoke, you will probably pay more for health insurance. If you drink to excess, you will  probably pay more for health insurance. If you are known to be under a great deal of stress, you may pay more for health insurance.  California does reward the health care Insurance consumer with lower premiums if they have practiced good health policies.

One of the most important things you can do as a health care consumer is to engage in preventive care. Not only will you be able to  spot serious diseases at an early stage, thereby increasing your chances of effective treatment and cure, but you should be able to  save money as well, since it is usually far less expensive to treat a disease when it's a molehill rather than a mountain.

<strong>About The Author:</strong><br />
Medical-Ins.com is a leading broker of <strong>health insurance in California</strong>.  We provide detailed information and cost breakdowns of <strong>Blue Cross</strong>, <strong>PacifiCare California</strong> and many more.  Visit  our site for a free quote and to help sort through the various health insurance plans to find the more affordable option for your  family.