A Hospital Insurance Plan

In many countries you can arrange medical insurance through specific private hospitals; I gave an example above of such a plan currently on offer in Uruguay. As I explained, these hospital insurance plans are not general health insurance, and they cover your treatment in that hospital only (in some cases, you can also be treated at an affiliated facility). If you travel outside the country or even within the country but far from the hospital through which you’ve organized your coverage, and you find yourself in need of medical care, you could be in trouble. You’ll either have to pay all medical costs out of pocket or find your way back to the hospital where you’re insured (covering the related costs yourself). Traveling back to the hospital may not be a viable option in an emergency.

Furthermore, the care you receive with a hospital insurance plan is sometimes not as good as it should be. Say you have a serious health crisis and are admitted to the hospital for an extended period. You mount a hospital bill upwards of, say, US$10,000, yet you have paid only a total of US$5,000 in premiums to your hospital plan. In this case, the hospital may take steps to cut costs. It is not unheard of for hospitals to withhold tests or treatments if they feel the patient has become too expensive.

Also, hospital plans generally do not have long life spans. The hospitals tend to lose money on these programs, and when any business is losing money the easiest solution can be to pull the plug. You do not want to have paid your insurance premiums for a number of years, assuming you will be covered for life, and then discover suddenly that the hospital will no longer honor your policy. By this time, your circumstances could have changed. You could have passed a certain age or you could have developed some condition, making it more difficult now to obtain alternative coverage.

Hospital insurance policies are risky but can be a good option if you live close to the hospital offering the coverage and if you do not plan to travel much throughout the country or abroad.