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What are the basics of health insurance?

The contract between you and the insurer, known as a policy, spells out what the insurer will pay for and how much of the bill you will have to pay. For instance, the policy may cover an office visit, but you may have to provide $20 of the charge. (That's called a co-payment.) Or, the policy may cover nothing until you've paid an agreed-upon amount out of your pocket. (That's called a deductible.) Deductibles and co-payments, plus any other nonreimbursable expense you may provide, are known as out-of-pocket-expenses.
Other policies might have co-insurance-a percentage of the bill that you must pay, possibly in addition to your deductible and co-payment.
The policy also will state the amount you have to pay monthly for the coverage, known as the premium, and the total amount the insurer will pay out for the life of the policy, commonly called a lifetime maximum.
Dr. Michael Roizen, MD
Internal Medicine

Health insurance plans come in more flavors than gelato. But luckily for sanity-loving people everywhere, they can all be sorted into four broad categories: indemnity plans (also called fee-for-service plans), point-of-service plans, health maintenance organizations (HMOs), and preferred provider organizations (PPOs). The first two flavors give you, the consumer, lots of options, but at a higher cost. The second two are considered managed care, so you have fewer choices, but the plans tend to be less expensive. Regardless of which plan you choose, health insurance is there to help you cover the potentially extreme (and sudden) costs of health care in case of emergency, or more than band-aid-requiring illness. In addition, if you have health insurance, you are more likely to get routine and preventive care that helps stave off major health events.

 

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Important: This content reflects information from various individuals and organizations and may offer alternative or opposing points of view. It should not be used for medical advice, diagnosis or treatment. As always, you should consult with your healthcare provider about your specific health needs.