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Catastrophic Health Insurance Plan

Catastrophic Health Insurance Coverage

Just as the name suggests, catastrophic plans are meant to provide health insurance coverage in case of a medical emergency or catastrophic event. They are also many times called high deductible plans, since as that name implies, the deductibles tend to be very high. Catastrophic plans can be a safe option for people who are looking for very minimal coverage, are generally healthy, and do not want to spend a lot on health insurance. However, these plans come with some downsides as well.

Advantages of a Catastrophic Insurance Plan

There are many advantages to these types of plans for people who are seeking minimal coverage.

  • Low Monthly Premium: Since the deductible is high and the insurance company will only be paying for major medical emergencies or needs if they occur, they are willing to lower the monthly cost to the user substantially. Plans of this type can cost as little as $20 monthly in some cases.
  • Security in case of accidents/medical emergencies: If major medical costs are what you are afraid of, this type of plan can give you the piece of mind you need. You will know that if something does happen, you will never end up going bankrupt from medical expenses and will only be responsible for paying your deductible.
  • Can be paired with a HSA: Since ongoing medical needs will come out of pocket, you can use a Health Savings Account (HAS) when you have this plan to ensure that you aren't paying taxes on your medical bills that fall under the deductible.

Disadvantages of a Catastrophic Insurance Plan

  • Very high deductible: The major downside to a catastrophic plan is the very high deductible, usually ranging from $2500-$10,000. This high deductible means that any medical expenses you incur before reaching your deductible are your responsibility. This includes doctor visits prescriptions, testing, and more. Essentially you pay for everything until your deductible is reached.
  • High out of pocket costs for ongoing/preventive treatment: Since your deductible is so high, the ongoing expenses for any medical car or preventive treatment will be very high since you are responsible for paying them. Specifically any prescriptions, testing, or doctor's appointments can be very expensive.
  • No prescription coverage: Most high deductible plans come with no prescription coverage, so if you are on medication you will have to pay for it in full.

Signing Up and Monthly Premiums

If you are interested in signing up for a catastrophic plan, the best way to understand what each plan includes, what deductibles are available, and what the monthly premiums will be is to get a free insurance quote below. Simply enter your information and then filter your results for catastrophic or high deductible insurance plans.

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