DO I NEED A MEDICAL INSURANCE?
Welcome to adulting! As part of your company’s employee benefits plan, you may be eligible for medical protection and receive a medical card to use if you fall ill.
Interestingly enough, you may also have your own personal medical card, bought by your parents when you started college years ago. Hmm, no one told you about this interesting conundrum. Now you have TWO medical cards, offering two separate coverage for the same purpose. Is this allowed? Which one will override which? Do you need to cancel one?
First of all, let’s find out what a medical insurance plan is all about. There are two types of medical protection available in the market:
- Medical Plan/Card: Covers hospitalisation and surgical costs
- Hospital Income: Provides income for you in the event of your hospitalisation
GROUP VS INDIVIDUAL MEDICAL INSURANCE PLAN: WHICH DO I USE FIRST?
Now, let’s explain the difference between the medical plan you get from your employer, and the one you get on your own.
GROUP VS. INDIVIDUAL COVERAGE – THE SIMILARITIES
The similarity between a group and individual medical coverage is in its function. Broadly speaking, a medical plan (regardless of whether it is group or individual) protects you by covering for the treatment costs incurred in the event of:
- An illness
- An accident
- A hospitalisation/surgery/ICU
The medical plan provided by your employer is known as a group coverage, as it covers a group of employees under one employer. The medical plan you purchase on your own or with your family, is known as an individual coverage.
Some medical plans also provide insurance coverage on death or total permanent disability, where your family or dependents will receive a lump sum pay out if either were to happen to you.
GROUP VS. INDIVIDUAL COVERAGE – THE DIFFERENCES
Depending on insurance providers and policy type, there may be differences between the plan you have on your own and the plan from your employer. Here are some important things that may differ between both:
limit – What is the total benefits the insurance provider
will pay in a year for a medical insurance plan?
Lifetime limit – What is the maximum claimable amount throughout your life time?
Daily room and board rate – What room type are you eligible for based on your plan?
It is important to know your limits for the above as it would help you to plan your finances, in the event of a medical emergency.
WHICH PLAN DO I USE FIRST?
Generally speaking, group plans have a lower annual limit than individual plans. Which plan you should use first depends on:
- The severity of your medical condition
- The necessity of operation
- The possible treatment options
Common illnesses such as flu which does not require an operation or lengthy treatment can be covered by your group or individual medical plan.
In the event of something more serious requiring inpatient surgery, hospitalisation and treatment that exceeds your group medical plan coverage, you can use the group coverage first and cover the remaining costs with your individual plan.
WHICH PLAN WILL OVERRIDE THE OTHER?
Either plan will not override the other, as both group and individual plans can operate in tandem. If your group coverage allows you a higher room and board rate, you can most definitely utilise that in the event of hospitalisation without affecting the individual coverage. However, if both individual and group have the same room and board rate, there is no difference in which you use, as long as it is within the given rate.
WHEN SHOULD I BUY MY OWN MEDICAL INSURANCE?
You should start purchasing your own medical insurance as soon as you are able to. Benefits of getting a medical insurance early:
- Protect yourself from rising cost of medical treatment
- The younger you are in age when you lock down a plan, the more affordable the premium