By Joanne Kerstetter

Being sick or hospitalized can make you feel helpless and the high cost of health care can make the situation even worse. Unfortunately, medical debt can quickly become overwhelming, causing it to be one of the leading causes of bankruptcy. A 2005 study done by Harvard Law School and Harvard Medical School found that illness and medical bills were the leading cause of roughly half of the personal bankruptcies filed.

Hopefully, you will never face a situation that causes you to incur a lot of medical debt. However, if something were to happen to you or a member of your family, you will want to be prepared. The best plan of action is to take some preventative measures before injury or illness strikes. One great way to do this is to perform a check-up on your health insurance benefits.

• Does your plan cover pre-existing conditions? Sometimes, a plan may not cover treatments for an ongoing medical condition. Find out if there are limitations or a waiting period involved in your coverage.
• Is the coverage sufficient? Find out exactly what services are covered and learn what preventive services are offered. Ask if there are limits on medical tests, out-of-hospital care, mental health care and prescription drugs.
• What does it cost? Research your premiums and co-payments. Explore the difference in cost between using doctors in the network and those outside it. Find out if there is a limit to the maximum you would pay out-of-pocket.
• What are my other options? Even if your current insurance plan seems to be adequate, it might be wise to review all your options. There are many types of coverage, such as Health Maintenance Organizations, Preferred Provider Options and fee-for-service. Many people are also able to get group insurance through membership in a professional association, club or other organization. You might also look into individual insurance options.

Whatever you do, do not allow your insurance to lapse. Medical bills for an accident while you’re uncovered will be far more devastating than the cost of paying for your own insurance for several months. Unfortunately, the number of people who have no health insurance coverage is growing. According to a US Census Bureau report, there are now 46.6 million uninsured US residents. If you become unemployed, you may have the right to extend your coverage through COBRA (the Consolidated Omnibus Budget Reconciliation Act of 1985).

The government also offers programs, such as Medicaid, for people with low-incomes. Also, check with the DC Department of Health and the DC Department of Insurance, Securities and Banking about health insurance programs for adults and children. 

Joanne Kerstetter is the president of Consumer Credit Counseling Service of Greater Washington, a division of Money Management International, the largest nonprofit, full-service credit counseling agency in the United States.

DISCLAIMER: The information or views presented in this column are those of the author and do not reflect the views of DISB.