The Best Guide for Choosing Health Insurance

Health InsuranceFebruary 5, 2020

You might think that purchasing a health insurance plan must be as simple as buying an iPhone, but you’d be very wrong. While subscribing to a plan is easy, selecting the best one for yourself and members of your family is one of the hardest purchasing decision you’d have to make especially at this time of the year when most healthcare plans are open for renewal and/or subscription.

Not to worry though as we’ve got a few pieces of valuable advice for you that are bound to make your decision making process a whole lot easier.

Only Pay What You Should

It is a little known fact that as you move up the income bracket, the Medicare Levy Surcharge (MLS) on your income increases as well, which does not include the Medicare Levy of 2% that all taxpayers already give out of their income.

For example, when you start earning more than $90K in a year, you are liable to pay 1% of that income as MLS. For those who are couples, or have a family to support, or simply a single parent, this tax does not come into force until their income crosses the $180K mark. For those with an income bracket of more than $105K, which is increased to $210K for those who have families, are a couple, or raising children as a single parent, this tax increases to 1.25%, while for people with income of more than $140K ($280K for those with dependents) the rate of MLS deduction is 1.5% of total taxable income.

Knowing these tax brackets is important as then you know how much you’d already be paying for insurance in the upcoming year, which should help you decide which insurance plan you can actually afford.

There Is No Harm in Switching

There is a myth that if you change your healthcare coverage plan, you’d have to re-serve the waiting period associated with the new plan, which is why many people don’t even consider switching away from their existing plans. However, you should know that the law protects you in this scenario, offering you the freedom to make an assessment of all the plans in front of you and choose the one with the best offering both in terms of price and in terms of coverage benefits.

But there is an important point in this which you must keep in mind. You won’t have to re-serve the waiting period only for those coverage services which were already offered in the previous plan, a principle referred to as continuity of coverage. Hence, whenever you decide to switch, just make sure to conduct an assessment of the new plan to ensure you would not have to re-serve the waiting period.

Assess the Extras

Coverage plans usually include only hospital covers which promise to insure you against the heavy hospital bill you would otherwise incur for even a minor injury, which is why many people opt for extra coverage as well to also insure their dentistry, optical, or similar specialized needs. All healthcare plans are different when it comes to extra coverage, so it’s up to you to make a careful assessment of which plan adequately fulfills your personal healthcare requirements, all the while keeping an eye on the cost of the package which should be competitive as well.

Mix and Match

It’s not necessary that you subscribe to extra services with your main hospital coverage plan, as you have the freedom to choose both plans separately. The reason why you may want to do this is because you may be getting cheaper health plan at one place, and then a cheaper extra coverage plan elsewhere and combining the two might offer you the most adequate coverage at the cheapest price. Although this may not always be the case, but there is no harm in trying, right?

The ultimate goal is to select a plan that fits your needs and also is not too heavy on the pocket because not only will you be saving a lot of money in case a medical emergency arises, but also saving by investing in a plan that costs the least while fulfilling all your medical requirements.