Health insurance or medical insurance is a type of insurance that helps reduce the costs of medical expenses that can be incurred by a person in the event of illness, accident or routine tests. This system finances medical expenses by means of tax kept in a mutual fund to cater towards family health.
It is sometimes referred to as “health coverage” and it pays for some or all of the cost of health services you receive. In developed countries, healthcare insurance is mandated. Medical and surgical expenses of an insured patient is covered.
Being an insured patient signifies that a percentage of your income is kept aside by the insurance company. In any event of loss or sickness, the insured individual receives financial protection or reimbursement.
THE IMPORTANCE OF HEALTH INSURANCE
•It shields you from potential financial and health risks.
• Preventive care like vaccines and some check-up is free and open to you.
•maintains your health and doesn’t deduct from finances at the point of occurrence.
•Reduces worry and panic.
•Increases life expectancy
•When you have a total coverage, a lot of financial cuts are guaranteed.
A health insurance plan can be a solution when dealing with increasing health care cost. No one wants to get sick but unprecedented events take place in our lives, and at the most critical moment, having a health insurance coverage can be the best bet.
TYPES OF HEALTH CARE INSURANCE
•High deductible health plans(HDHPs)
•Point of service plan (POS)
•Health maintenance organizations(HMOs)
•Preferred provider organizations (PPOs)
Learn how these plans differs to help in your planning.
1. High-Deductible Health Plan With or Without a Health Savings Account.
You may be able to pay less for your insurance with a high-deductible health plan (HDHP). With an HDHP, you may have:
Higher costs than other health plans.
A Health savings account that is not taxed(HSA).
2.Point-of-Service Plan (POS)
A POS plan blends features of an HMO with a PPO. With POS plan, you may have:
More freedom to choose your health care providers than you would in an HMO
A moderate amount of paperwork.
A primary care doctor who can coordinates your care and who refers you to specialists
You pay: Premium, Deductible and copays
3. Health Maintenance Organization (HMO)
An HMO delivers all health services through a network of healthcare providers and facilities. With an HMO, you may have:
You don’t choose your health care providers always.
There is little amount of paperwork compared to other plans
A primary care doctor will manage your care and refer you to specialists when you need one so the care is covered by the health plan; some HMOs will require a referral before you can see a specialist.
You will be required to pay;
Premium:The cost paid for insurance each month.
Copays: This is a flat fee paid when you get care.
Coinsurance: This is when you pay a percentage of the health care charge.
Deductible: Depending on your plan, you may need to pay this amount before it covers any care except preventive care.
4.Preferred Provider Organization (PPO)
With a PPO, you may have:
A moderate amount of freedom to choose your health care providers — more than an HMO; you do not have to get a referral from a primary care doctor to see a specialist.
Higher costs if you see doctors that are not in your network vs. in-network providers
There is more paperwork than with other plans if you see health providers that are not in your network.
You pay: Premium, Deductible, Copay and more costs if you decide to see a health providers that’s not in your network.
Setting up a Health savings account helps you save money towards health insurance. Health insurance is a necessity as it has lots of advantages to the insured individual. Health insurance helps covers the cost of an insured individual’s medical and surgical expenses.
There are various plan types, and they are different in regards to what is to be covered and how fast a person can access treatment.
Currently, a person in the U.S. must have some form of health insurance coverage. Anyone without a form of coverage may need to pay a fine.