Medical insurance, also known as health insurance or hospitalization insurance, is a type of insurance that pays for some or all of a person’s healthcare costs. This type of insurance is generally offered by private companies, and the prices vary. The government also offers certain types of health insurance, called public coverage, which is provided by the federal or state governments. Some examples of public coverage include Medicare, Medicaid and the Veterans Administration healthcare program. Private insurance can be purchased individually, or a person may choose to purchase group coverage through an employer or union.
A person’s healthcare expenses can be very high, so having the proper health insurance can help reduce the risk of financial disaster. The cost of a plan can be quite expensive, but it is important to weigh the options to decide what plan works best for an individual or family. When deciding on a plan, it is important to consider the deductible and coinsurance, as well as other costs such as prescription drugs. Many people find that a high deductible plan can be the most affordable, especially for individuals who do not expect to use many healthcare services.
Many healthcare providers are part of an insurance network, which is a list of doctors, hospitals and other health care providers that the insurer has negotiated discounted rates with. This is often referred to as in-network healthcare. Health plans require that patients see in-network doctors for the most cost savings. Typically, the doctor must provide a referral to see a specialist in order for the patient to be covered.
Purchasing a healthcare policy is a big decision and the process can seem overwhelming at times. There are several things to keep in mind while shopping for a plan, including the coverage limits, the deductible and the waiting period. There are also multiple plan options to choose from, including a catastrophic and gold plans. The ACA requires all health plans to cover certain essential benefits, which are the 10 categories of healthcare: hospitalization, emergency room visits, office visits, chronic disease management, vaccinations, preventive services and dental care.
A catastrophic health insurance plan is a good option for younger individuals who do not anticipate using many healthcare services and have enough cash saved to pay a high deductible in the event of a severe illness or injury. The ACA allows individuals under 30 to purchase these plans, and some families with incomes below a certain amount can get them too.
Individuals who prefer flexibility in the healthcare industry should look for a preferred provider organization (PPO) plan. These offer more choice than a health maintenance organization (HMO) and typically have lower premiums. However, they still limit your choices by requiring you to name a primary care physician who oversees your health and must provide a referral for specialists. The PPO plan offers the most flexibility, but it is also the most expensive of all the plans considered in this article.