This week we talk about a very unpleasant and dull topic: health insurance. Whether you’re choosing a health insurance plan from your employer or shopping for your own on the exchange, there are a ton of terms you need to know: deductible, HMO, PPO, co-insurance, out of pocket, etc. My guest is Todd Erkis, a former actuary and insurance professional who is now a professor of finance at St. Joseph’s University in Philadelphia who wrote a wonderful book called What Insurance Companies Don’t Want You to Know. He helps us wade through the confusing waters of insurance and warns us of the dangers and monetary penalties for not having insurance.
There are some solid resources across the internet. Here’s a great guide from The Simple Dollar.
A Few Health Insurance Terms You Should Know
The amount of money you’re personally responsible for before your insurance company begins paying.
This is the yearly cost you pay to your company for the insurance coverage you’re going to need. If you’re a single person, your premium will be small and it’s possible your company covers 100% of it. If you have a family, it may come out of your paycheck.
Prior to the Affordable Care Act, there were “maximum policy limits” which allowed insurance companies to stop coverage after they had paid out a certain amount, which is very bad for very sick people. But now under ACA, insurance companies have to define the upper limit of what you’ll pay out of pocket.
If you’ve been on a domestic flight sometime in the past year, you’ve probably heard the gate agent make a strange announcement that if you poses a Samsung Galaxy Note 7 phone you must surrender it to the airline for safe transport. You can’t bring that phone in the cabin because it might explode! Yes, we have reached the era of exploding smart phones…and there’s video.
On another note, have you been making your way through the wonderful texts of the Financial Literacy Library? Even better, have you been tracking your whole financial progress through the custom Moneysplained Net Worth Calculator?