Health insurance… here’s what you’re probably thinking, “Why do I need health insurance? I’m young, healthy, and rarely need to visit the doctor. Why should I pay for something I’ll never use?” All valid point, but take a minute and think of this. Accidents and illnesses happen without warning, even to the healthy young adults. Sure, health insurance is expensive, but not having the proper coverage may cost you your life. That’s a hefty price to pay.

Consider this…

As you sit there with your college diploma in hand, ready to conquer the world, take a minute to consider these points. Health care in the United States is a nightmare. Some, but probably few, will argue that fact. There are thousands of options when it comes to receiving care and paying for it. Some of these are option good and some are what nightmares are made of. When it comes to choosing an insurance policy that’s right for you, the confusion tends to be endless. So, let’s take a few minute to learn a little more about your options.

There are two essential categories of health insurance: managed care and indemnity plans. Though you’ll pay more for indemnity coverage it offers more flexibility than a managed care plan. Through indemnity coverage you’ll have your choice of doctor, lab, hospital or specialty clinic. When you need medical care you’ll have to pay an out of pocket expense, called a deductible, before your coverage kicks in. Deductibles range from a few hundred dollars all the way up to $1,000 or more. Your deductible depends on the extent of your policy. Less coverage equals a lower deductible. More coverage equals a higher deducible. Also, indemnity plans require a co-payment on medical care. This means you’ll be responsible for paying a percentage of the treatment costs along with the deductible. Generally, indemnity plans pay only for accidents or illness. They usually don’t cover preventative care.

Managed care is the complete opposite of indemnity coverage. Deductibles are usually smaller, co-payments are lower, and preventative care is usually covered. However, your options are limited. Through a managed care plan you can only choose between health care providers contracted out by your health maintenance organization. If you go elsewhere you will pay the full amount. That’s a fairly rough deal, so many managed care plans offer hybrid options that include many of the desirable characteristics of an indemnity plan.

Which way to go

For those of you who are young, single and find a job that offers health insurance, take it! It may not be the perfect plan, but it beats any coverage plans that you will purchase on your own. Signing up through an employer will probably come with a few options. Take a good, long look at them, and if need be ask for help from a human resources representative. Make sure to choose the plan that’s right for you. Chances are, if you’re young and healthy, you’ll want a plan with a low premium and higher deductible. Look for a plan that minimizes your out-of-pocket expenses. When it comes to choosing between and indemnity plan or a managed care plan, you may or may not have a choice depending on your employer. Both offer advantages and disadvantages, so crunch the numbers before committing to one or the other.

Making a deal

Health insurance is a costly part of life, but there are ways to save. If you’re self-employed, shop around before you commit to a plan. If you’re under 50 and healthy, insurance companies will want your business. You are the ideal client and reduced rates are always available to the ideal client. Also, don’t be afraid to take advantage of breaks from good ole Uncle Sam. The self-employed can write off up to 45 percent of their insurance premiums. Also, some employers offer flexible spending accounts. In this case, you can pay for premiums and costs not covered by insurance with cash, so they are not subject to taxes.

If you’re married, and your spouse has coverage from their employer, weigh your options carefully. It might benefit you, financially and coverage-wise, if you measure the pros and cons of separate coverage, double coverage, or combined coverage under only one of your employers..

Lastly, if you’ve been healthy, and think you can get by with minminimal health coverage, you many want to look into purchasing “catastrophic coverage”. This indemnity policy offers extremely low premiums, but deductibles can range up to $2,500. Coverage is extremely limited to “catastrophic” events, so you’ll want to learn all about the coverage before opting for this plan.

Just remember, you are a college grad now. You are capable of many great things. This is not the time to come up short. Make the right decision and purchase a health insurance plan that works with the new you! Your life literally might depend on it.