Catastrophic health insurance is one of those terms that has come into usage that in one sense appears slightly more complicated than was ever originally intended. You are unlikely to find a health insurance plan that refers to itself as a catastrophic health insurance policy, but the intent behind these plans was to provide health insurance on a more limited basis than other types of plans.
The intent was to provide a health insurance policy that was geared purely towards medical emergencies and short-term hospital visits or stays.
This meant that the catastrophic health insurance policy could be offered at a lower annual premium cost, because it did not include other areas of health insurance coverage such as that of doctors visits, preventative treatment, outpatient procedures, laboratory tests and diagnostic services or prescription drugs etc.
The intent was to provide a health insurance policy that covered what might be deemed an emergency in the life of the individual if not strictly speaking an emergency in a medical or clinical sense.
These catastrophic health insurance policies would normally have a cheaper annual premium, but would also have a higher than average deductible and a similar type of policy, and could have quite a high coinsurance clause as well.
The cost therefore, of a catastrophic health insurance policy was not necessary as cheap as it might seem, but would appear more cost-effective for a certain range of individuals because it was specifically focused on certain areas of healthcare and costed accordingly.
Catastrophic Insurance
Catastrophic health insurance would normally be an attractive type of health insurance plan or policy for an individual who deemed themselves to be in good health and unlikely to suffer any illness that was foreseeable or likely to occur in the immediate future.
The individual also be unlikely to have an existing medical condition which would be excluded under other types of health insurance plans or policies. Catastrophic health insurance policies would also be unlikely to include any preventative treatments or diagnostic tests, which can often be a false economy.
When considering any type of health insurance policy, including a catastrophic health insurance plan it is important to recognise that there is a significant amount that an individual can do that affects their health and subsequent health insurance costs in the long term that are outside the scope of the health insurance policy.
Health prevention and health promotion are very much the remit of the individual, and most health insurance plans and policies do not really give much by way of benefit in this regard. Some health insurance policies may have deals with fitness clubs that may be of some benefit, but this is rare.
