For people who rarely go to a doctor, I am thinking Major medical
Insurance may be more cost effective than HMO insurance that has $1000
deductible and costs about 2,500 per year to stay enrolled.

SO: it costs us – this is for one person, remember – $3876
plus the $500 deductible per year – or $4376/year. Then we
have to pay 20% of his doctor visits (approximately) and 20%
of his prescription medicines.

Major medical can be a good deal if you don’t go to the doctor often. I
have Blue Cross (but it’s through my job so I don’t pay for it). It
doesn’t cover prescriptions – this is true of many major medical
insurance plans, so check on this. We have a separate prescription plan
but it’s not part of my Blue Cross coverage. It has a $500 deductible
and covers 80% after that, up to a certain limit after which you don’t
pay at all (that’s important, mine has an overall cap of $2500, after
that I don’t have to pay). And I can choose my own doctor, although
that isn’t a big issue for me.

I’m single and in good health, so this was the best deal for me. Our
company also offers an HMO but it has a monthly fee. If you go to the
doctor frequently the monthly fee is offset by the lower costs per
visit, but if you’re like me and go to the doctor once a year, it’s not
as much of a bargain. I have to pay cash for my doctors visits (I’ve
never hit the $500 deductible) but I pay less overall. This way I’m
covered if something serious happens, but otherwise I don’t pay much.

The other disadvantage of major medical in some cases is what it doesn’t
cover. This is true of any medical plan, so you have to read the fine
print. For example, a couple of years ago I needed to see a therapist,
and this wasn’t covered at all under my health plan, mental health is
only covered if you have to be hospitalized. This kind of thing is
covered under some HMO’s.

To some extent you can predict your medical expenses, and to some extent
you can’t. I would look at what you might pay under different
circumstances – what you think you can predict, what might happen if you
have a not-too-serious illness, and what might happen in a catastrophe.
My Blue Cross is fine if I stay healthy, but if I got sick and suddenly
required frequent doctor’s visits, I’d probably pay more, although I’d
still be protected from catastrophic bills.

The other posters made some good responses, and here is another
alternative that I find works well for me:
A high deductible policy with a Medical Savings Account. MSA’s are not
available for everyone, but even if you put the savings from a
conventional policy into a standard savings account, you still can end
up far ahead.

My deductible is $2,250, but for a 38 year old midwestern smoking male
my monthly insurance costs only $67. The idea is that you take the
difference between this low rate policy and what a conventional policy
would cost (lets say $250), and put that each month into the MSA, $183
each month, $2,196 a year. Do that every year, and instead of paying
the insurance company a lot of money, you are in effect “paying it to
yourself”. And over time, you build up the account to where it covers
the deductible.

If you get ill during before you have put enough money aside for the
deductible you of course take a nasty hit. However, if you rarely need
a doctor, it doesn’t take long to get ahead. My high deductible policy
covers everything after that $2,250 deductible, and I believe it’s got a
million dollar cap.

And if you DO qualify for a MSA (self employed and a few other cases),
then you can write off MSA contributions up to 60% of your annual policy
deductible. You can also use funds in your MSA for any medical related
expenses that are not covered by your policy, such as cosmetic surgery
or, as I used mine to do this past year, LASIK.

mental health is only covered if you have to be hospitalized.
This kind of thing is covered under some HMO’s.

It all depends on your policy. HMO’s are very difficult to deal with if you
have any health problems. They are great for the person who rarely goes to
the dr.

I have a PPO and we have mental health coverage that does not require
hospitalization. We have 8 alloted visits and can request more.
Mental health issues are seriously ignored by the medical insurance
industry.