Health Insurance

23 Other Types of Health Coverage Other types of health coverage are sold in California, but if it will be your main source of coverage, you should make sure that it meets minimum essential coverage requirements. If your policy does not meet these requirements, you might have to pay a tax penalty to the IRS as if you did not have coverage at all. High-Deductible Plans These plans have lower premiums but high deductibles. The deductible each year can be over $5,000 for an individual and over $10,000 for a family. This means that you must pay a lot of money each year before your plan covers anything except preventive care. Usually a high-deductible plan is combined with a Health Savings Account (HSA). You or your employer can put tax-free money into a savings account and use this money to pay your deductible. Limited Benefit Plans Limited benefit plans are also called mini-meds. They provide very limited benefits. They are advertised on TV as low-cost health insurance. You should read the policy very carefully. If you have a serious illness, you might run out of coverage quickly. These plans do not count as full health coverage and you may end up paying a penalty at the end of the year if you don’t have other coverage. Discount Plans Discount plans are not health insurance. They simply offer discounts from certain doctors, pharmacists, and other providers. They are often advertised on the Internet and late- night TV. You should read the plan contract very carefully. Before you buy, contact the California Department of Insurance at 1-800-927-4357.