Julie Amparano

Planning ahead

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These days there is an insurance plan for just about everything. Travel insurance, health insurance for your pet, insurance for your insurance. While these are luxury items, others are more essential. Insurance plans for life, for health, and for disability. Here are five insurance plans that everyone should know about and consider purchasing:

Health insurance: We all know what it is. And we all know that most of us can’t do without health insurance. But how do you find the right policy? Whether you are shopping for a plan on your own or selecting a group plan at work, you need to know the basic differences between the two major types of health insurance coverage.

A health maintenance organization (HMO) is one of the most economical plans. The HMO has a network of medical providers and you must always use a provider within the network to be covered. The only time an HMO will cover you outside this approved list is in case of an emergency, or if you receive prior approval because there isn’t a provider within the network. With an HMO, you can’t seek a specialist, such as a dermatologist, on your own. You need your primary care physician to allow you to see one and then refer you to one.

A preferred provider organization (PPO) also uses a network, but is less restrictive. If you don’t use a doctor within the network, you are still covered but at a higher deductible. You can also make appointments to see a specialist on your own and without approval of your primary care physician. Like HMOs, in case of an emergency, you will still be covered under the PPO rate even if you use a non-network provider in most cases.

If you are shopping for a health insurance plan on your own, be prepared to pay more for the policy and to receive less coverage. For help finding an individual plan, visit Arizona’s state insurance department Web site at www.id.state.az.us/consumer.html, which lists area insurance providers. Also, eHealthInsurance.com and MyInsuranceExpert.com provide free quotes.

Catastrophic illness insurance: A recent study published in The American Journal of Medicine reports that 62 percent of all bankruptcies in 2007 were due to medical debt and income loss due to illness.

Most medical debtors in the study were well educated and middle class; three quarters had health insurance. What went wrong? While many take comfort in knowing they have good health insurance, there are instances when basic coverage is not enough. Consider that most health insurance policies have caps and do not cover or reimburse the expenses associated with providing proper care for a terminally ill patient or one suffering from a catastrophic illness.

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