If you're on a limited budget, shopping for health insurance is a bit of a catch-22. There are plenty of plans out there with low premiums, but in the event that you ever have any serious medical problems, you'll probably be forced to pay more of the bill than you can really afford. On the other hand, the best coverage (with low deductibles and non-existent co-pays) typically comes with a high monthly premium.

Health Insurance Pricing: Finding the Right Balance

If you can't afford the best and most complete coverage, buying health insurance is unfortunately a bit of a gamble. You'll probably be tempted to reduce your monthly premium by eschewing things like emergency room coverage and low deductibles for hospital visits and surgery. One of the reasons you need health insurance, however, is to protect you from going bankrupt because of unexpected emergency room bills.

When you're choosing a plan, it's important to pick one with a deductible that is low enough that you could still afford to pay it in the event of something unexpected. Don't go with a high deductible under the assumption that nothing is going to happen to you. The last thing you want is to be lying in the hospital wondering how you're going to pay the bill.

A good way to pick a plan that fits your budget is to look at what kind of out-of-pocket cap it has. Most insurance plans limit the amount you have to pay in any given year, regardless of how much medical care you wind up needing. Pick a plan that is right around your budgetary limit--this will allow you to keep your premium down but will also protect you in the event that disaster strikes.