2007-03-17 00:21:10 · 7 answers · asked by George B 1 in Business & Finance ➔ Insurance
Health insurance policies can be written to pay any number of different ways. I've seen them pay 70% and the insured pays 30%. It just depends on what the insured or the employer, in the case of group policies purchases.
It's no different than your Auto Insurance. You can chose different collision deductibles. Some people chose a $500 deductible. Some chose a $1,000 deductible, etc.
2007-03-17 01:57:44 · answer #1 · answered by Faye H 6 · 0⤊ 0⤋
When health insurance was invented after WWII, it was common for the insurance plan to pay 100% of the cost.
With the rising cost of health insurance, modern plans require the insured to pay part of the cost. This has two effects. First, it lowers the cost of the insurance plan to the employer, making this expensive benefit marginally more affordable. Second, it provides an incentive to the insured not to obtain health services that arent necessary (when there is no cost involved to the insured, there is no incentive not to see a doctor for every little thing).
My guess is that in time the co-pay obligation of the insured will only increase.
2007-03-17 07:52:08 · answer #2 · answered by Anonymous · 1⤊ 0⤋
The price gouging of Doctors and hospitals has forced insurance companies into a Co-insurance model to keep the premiums "affordable" Policies that pay 100% usually cost more than your house payment. It's a shame.
Refer to:
60 minutes
Peter Jennings (his last special)
Current trends report
2007-03-21 00:36:09 · answer #3 · answered by uainsdude 1 · 0⤊ 0⤋
The first reason is to reduce their costs of a payout.
Second, since you are liable for 20%, it gives you an incentive to be careful in the spending since you would have to pay 20% out of your pocket in addition to the premiums you are paying. This is known as Co-insurance and it helps eliminate some of the moral hazards that come naturally with insurance.
2007-03-17 10:44:21 · answer #4 · answered by mystiqalsoul 1 · 0⤊ 0⤋
To encourage you to manage your own health a little bit - shop around, and not run to the doctor for every splinter and band aid you need.
It's the same principal as having a deductible on your homeowners insurance - so they don't have to process claims for paper clips that get stolen.
2007-03-17 15:27:52 · answer #5 · answered by Anonymous 7 · 0⤊ 1⤋
It varies from company to company.
Be happy you even can afford it. 20% is VERY little to have to pay. Alot of people have to pay ALOT more then that if not everything straight out of pocket.
2007-03-17 07:29:01 · answer #6 · answered by Anonymous · 0⤊ 0⤋
Because otherwise, you'd pay a LOT more in premiums!
2007-03-17 20:44:50 · answer #7 · answered by zippythejessi 7 · 0⤊ 1⤋