Medical Insurance is possibly the most important aspect of a person’s life and is the difference between health coverage and not being able to go to the medical provider when sick or for a checkup. Medical Insurance is used to pay for medical expenses, which would cost an arm and a leg without insurance. At least with insurance the majority of medical expenses are covered by the insurance carriers and the patient only has to pay a nominal fee called a co-pay.
Medical Insurance also encompasses long term nursing or custodial care and disability. Medical Insurance is provided for fulltime employees (40 hours per week) by an employee’s employer. Insurance can be purchased by businesses or by individual people. Medical Insurance may also be provided by the federal government through different programs such as welfare.
There are nine keywords that are involved with health care insurance that every policy holder needs to know to understand their coverage.
A premium is the amount of money a policyholder pays to the insurance company each month to obtain the coverage.
The deductible is money paid out of pocket by the insured for medical provider visits or prescriptions before the insurance policy pays its share of the bill.
Policy holders make a copayment whenever they visit a medical provider for a checkup or buy a prescription. The policy holder might have to shell out $15 out of pocket to pay for a visit to their medical provider but the insurance company will pay the remainder of the bill, which could be anywhere from $50 to $400.
Sometimes a policyholder has to pay a coinsurance. A coinsurance is when the insured pays a percentage of the total cost of the service(s) provided instead of paying the fixed amount (copayment). This could lead to the insured having to pay a very small fee or a very large fee; depending on the percentage determined by the insurance company.
Each insurance policy has exclusions. Exclusions are predetermined services that are not covered in the plan. If a policyholder has a service performed that is an exclusion then the insured will have to pay for that service in full, without the help of the insurance company.
There are coverage limits involved in most insurance plans. The majority of coverage limits deal with how much of a service the company will pay for. Once the company pays for the amount agreed upon the insured will then have to pay the remainder of the bill.
On the other hand, there are limits for the insured too. They are called out of pocket maximums. Once the insured reaches the maximum amount of money paid out of his/her pocket for services, the insurance company has to pay the remainder of the bill.
Capitation is an amount of money that an insurance company pays to a medical care provider for promised care of all the insurance company’s policy holders in return.
The final term involved with health care insurance that all policy holders should know is in-network provider. An in-network provider is a preselected heathcare provider on a list of providers put together by the insurance company. These in-network providers provide medical care for a discountedcost per a pre-arranged agreement with the insurance company.
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