What are Health Insurance Premiums?
A health insurance premium is a monthly fee you pay to an insurance company or health plan to provide you with health coverage. The scope of the coverage itself (ie, the amount that it pays and the amount that you pay for health-related services such as doctor visits, hospitalizations, prescriptions, and medications) varies considerably from one health plan to another, and there’s often a correlation between the premium and the scope of the coverage. The less you have to pay for your coverage, the more likely you will have to have to pay when you need health care, and vice versa.
Your insurance premium is the amount you’re required to pay each month for coverage under your medical plan. Insurance premium costs can vary significantly based on the plan. If you’re choosing your own health insurance, be sure to pay attention to not just its premium, but what that premium buys you. While you may be inclined to choose the plan with the lowest-cost premium available, that could end up costing you in the end.
Premiums and insurance plans
Anyone with health insurance has a premium attached to that plan, which represents the cost of coverage. Generally, the lower your premium, the less comprehensive health insurance coverage you’ll get, and the more you may have to spend out of pocket.
The premium is just one part of your health coverage. On top of your premium, you’re also responsible for additional costs, like deductibles and copayments, which can add to the overall expense of your healthcare..
To figure out what type of plan is best for you, review your medical spending from previous years and see how often you tend to use your coverage. Of course, you can’t account for unexpected accidents and the like, but if your health is good, you might come out ahead financially by opting for a lower-cost plan. On the other hand, if you’ve been recently diagnosed with a health condition, or feel that your health is declining, it might make sense to pay a higher premium but limit your remaining expenses.