Updated 12.06.2021

7 Things to Know Before Getting a Health Insurance Plan

An excellent health insurance plan makes sure your medical needs are provided for. It’s also a financial commitment. Investing in a plan that really pays out for everything you think it covers is crucial.

Here are seven essential points you need to consider before picking a health insurance plan.

1. Who does your plan need to cover?

Some health insurance plans payout for the needs of one person: you, your aging parent, or your child who’s currently swotting away in college. Other plans cover more than one person, up to large families with multiple adults and kids.

Before choosing your health insurance package, write up a list of everyone who needs to be covered by that plan. Then write down all their medical needs. Here are some questions to consider.

  • Do they take medication on a daily or monthly basis?
  • Do they have chronic conditions that need to be managed?
  • Are they at risk for cancer, tuberculosis, heart disease or STDs; will they need consistent screenings and tests?
  • Does anyone spend many hours a week on the road, or work in a high-risk job where accidents frequently happen?
  • Is anyone expecting to fall pregnant within the year?
  • Are there smaller kids who run the risk of breaking bones and needing x-rays, or staying overnight in hospital on a nebulizer during cold months?
  • Is there an expecting or new parent who would benefit from free pediatric advice?

A health insurance plan typically covers you for a year, so strategise for the year ahead. Map out everyone’s medical needs, and decide what portion of that you’d like your health insurance plan to help out with.

2. What does your plan need to cover?

When it comes to types of health insurance plans, the options can be overwhelming. Here are some things that your plan may or may not cover.

  • Doctor’s visits
  • Medication
  • Certain chronic conditions
  • Screenings and tests
  • Maternity
  • Mental health
  • X-rays and scans
  • Prosthetics
  • Surgery
  • Hearing aids
  • Dentistry
  • Optometry
  • Physiotherapy

Although most plans will cover a lot of these aspects, combinations vary – and so do the limits and payouts. So make yourself a cuppa, settle in, and read all that fine print. You don’t want to be taken by surprise when you need help the most.

3. A high deductible saves you money… if you meet certain criteria.

Most health insurance plans don’t cover 100% of your medical costs. A deductible is an amount you’ll have to pay for an expense before your health insurance will start helping you out.

If you have some savings and the people covered in your insurance plan are all relatively healthy (they don’t need a frequent doctor or hospital visits and expensive medication every month), you may benefit from taking out a plan that has a higher deductible. You’ll pay less on insurance for the year but have a higher sum to pay out for whatever medical expenses do occur.

There’s no definite way to determine whether you should settle for a higher deductible plan, but here’s how you can make a reasonable estimate: figure out how much you’ll save on the higher deductible plan, then figure out what medical expenses you may rack up in the coming year and what you’d have to pay out for those on that higher deductible plan. Comparing the two sums may help you to decide if the savings are worth the risk.

READ ALSO: 9 Ways to Boost Your Retirement Savings

4. The plan with the lowest payments may not be saving.

Discussing deductibles leads us to our next crucial point: don’t be quick to jump on the plan that appears to be the cheapest. Less expensive health care packages may require both higher deductibles and higher co-payments.

While a deductible is a cost you’ll have to cover before your insurer will help, you will still have to continue to cover a part of your expenses once your insurance does kick in. This cost is called a co-payment. On top of that, there are many types of expenses that a cheaper plan simply won’t cover.

The best way to figure all this out is to write up a projection for what you may have to spend on medical expenses in the coming year. Take your time and include every last detail. Then pick the best cheap plan available, and another, more expensive one (make sure it’s a package you can still manage financially). Work out what you will need to spend on each plan, taking into account the monthly insurance payments plus the expenses on your projection. You may find that the pricier plan actually saves you money.

5. Using the insurer’s medical network may not be practical for you.

Many insurers liaise with a network of hospitals, doctors, pharmacists and specialists. If you seek help outside of this network you may need to pay extra, or on cheaper plans, you may not even be covered.

Ideally, pick an insurance provider with an enormous medical network. Then, do your research. What are the options like where you live, close to places you frequently travel to, or near your place of work? The medical assistance supported by your insurance plan needs to have a good reputation and offer excellent quality care, be nearby and easy to travel to, and in a safe location. If you live in a rural area, this setup may not work for you.

READ ALSO: National Health Insurance (NHI) South Africa: Pros & Cons

6. How does the claims process work?

For most medical expenses, your care provider will file the insurance claim for you. You’ll need to know exactly what your plan covers and fill in a form with all the necessary info.

In some cases, you may need to file a claim yourself. Some insurers are easier to file claims with than others. They may have a handy app, a short waiting time when you’re making a call, or a platform where you can upload your scanned claims. Get familiar with your health insurance provider’s claims processes, and find out what other people have to say about their processes too.

7. The best insurers help you to stay healthy.

Some insurers simply payout once you’re racking up medical expenses. But the ideal insurer will help to keep you from reaching the doctor’s waiting room. Your insurer may offer support and incentives for staying healthy. These could include:

  • weight loss programs and weight monitoring
  • free participation in certain sporting events
  • pediatric advice helpline
  • advice and support system for pregnant parents
  • free checkups or screenings
  • cash rewards for good health

Pick an insurer that genuinely cares about your health. You, your family and your bank account deserve it.

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