Types of Health Plans
HEALTH INSURANCE
Listed below are four categories under which most of the health plans in the country can be classified.
Basic Plans
These
are basic insurance plans that provide coverage for hospital stays longer than
24 hours. Typically, these also provide pre- and post-hospitalization coverage.
These plans typically have sub-limits on costs like room rent. In some
procedures, they limit the amount you are entitled to. Some of the plans
additionally demand that you split the insurer's claim fees with them (Co-Pay).
If you prefer to go to the most expensive hospitals, then do not go for these
plans. The various sub-limits may be restrictive and you may end up paying a
lot of money because of the various sub-limits imposed by the plan, even if
your sum insured is not exhausted. Most of the plans restrict daily room
rent to 1% of the sum insured. As a result, if, for instance, your sum
insured is Rs. 2 lakhs and the hospital charges Rs. 3000 per night for a room,
you will incur a loss of Rs. 10,000 within 10 days of your hospitalization. The
prices for these plans are very reasonable and appealing. Find out the price of
a room at the hospital you have chosen, whether there are any restrictions on
operations, and whether your insurance company has negotiated discounts with
the facility before choosing one of these. These plans are also
beneficial for those who don't mind paying when their costs exceed the limits
of their plan. For those who reside in tier II and tier III cities, these are
excellent plans. Make sure the insurer has a cashless facility for your
favorite hospital as well.
Standard Plans
These
plans resemble the Basic plan in many ways; however, they don't have any sub-limits.
They might also provide further advantages like transportation for emergency
medical services. The premiums are greater than those for the basic plans
because there are no sub-limits. The additional premiums may, at times, be up
to 25% more for the removal of limits. Make sure the insurer has a cashless
facility for your favorite hospital as well.
Superior Plans
These
plans cover expenses like hospital cash for non–medical expenses, expenses for
persons accompanying the patient in the hospital, and convalescence
benefits. Insurers tend to limit the amount they pay for these
expenses. For example, insurers will pay hospital cash of Rs 250 for 10
days per hospitalization. You tend to pay much higher premiums for these
additional benefits, so keep an eye on the additional premiums compared to
standard plans. In our opinion, the number of benefits these plans offer doesn’t
justify the higher premiums. If you can pay these out of your
pocket our suggestion is that you skip these covers.
Premier Plans
These
are high-end plans and these provide many additional benefits like restoring
your sum insured, nursing benefits, OPD, dental cover, and so on. While
these plans will offer many additional benefits, the premiums tend to be very
high.
Insurance should cover expenses that you cannot pay for
yourself. They should be used to cover out-of-the-blue expenses that can hurt
you financially. It may not be wise to use insurance to cover every single
expense that you are likely to incur. Cover the big ones and pay yourself
for the smaller ones. The insurer will then provide you with competitive
premium rates because they would understand that you have some stake in the
outcome. For example, we do not see much point in paying an extra premium
of RS 300 for hospital cash cover that pays a maximum of RS 2500. It is
possible that most of us can very easily pay Rs. 2500. You can use that
RS 300 to buy yourself additional hospitalization cover for say another 20,000.
One thing you must check for is to ensure that the insurer has a cashless
facility for your preferred hospital(s). Otherwise, you may have to pay
first and then get reimbursed. For high hospitalization expenses, it may
sometimes be difficult for you to organize that cash.
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