Health insurance is one of the most common insurance in the United States, yet not so common. Health insurance is a type of insurance coverage that typically makes payments for surgical, medical, drug prescription, and sometimes dental expenses that are incurred by the insured.
The insured simply refers to the person that the insurance covers. Health insurance usually reimburses the insured for all expenses incurred and covered on the insurance. The imbursement can be paid to the insured or the care provider directly.
Health Insurance
In the US, health insurance is often included in employer benefit packages to entice quality employees. The premiums are partially covered by the employer but also often deducted from employee paychecks.
Health insurance can sometimes be tricky to navigate. The managed care insurance plans usually require policyholders to receive care from a network of designated healthcare providers who they are in-contract.
This is simply to provide the highest level of coverage. If you decide you want to take care outside the network, you would have to pay a higher percentage of the cost. In rare cases, the insurance company can refuse to pay for services outside the designated network.
Types of Health Insurance
In order not to bore you out, I would only be listing out the top three types of health insurance and we would see how they compare.
- Health maintenance organizations (HMOs).
- Preferred provider organizations (PPOs).
- Exclusive provider organizations (EPOs).
Now, let see how these insurance types compare.
Health Maintenance Organizations
An HMO, all health services must be through a network of healthcare providers and facilities. With HMO, you may have the following;
- Less freedom to choose health care providers.
- Least amount of paperwork (at least compared to other plans).
- Primary care doctor to manage your care and refer you to specialists when you need one.
In this type of insurance, you get to pay the following;
- Premium: The monthly payment for insurance.
- Deductible: Plan may require you to pay the amount before it covers care except for preventive care.
- Copays and/or co-insurance: Copay is a flat fee that you pay when you get care. Co-insurance is a percentage of the care charges you have to pay.
There are no claims forms to fill out.
Preferred Provider Organization (PPO)
With a preferred provider organization, you may have the following;
- A moderate amount of freedom to choose health care providers.
- Higher out-of-pocket costs if you see doctors other than designated doctors.
- Has more paperwork compared to other plans.
In this type of insurance, you get to pay the following;
- Premium: Monthly payment for insurance.
- Deductible: you are likely to pay higher deductibles if you see out-of-network doctors.
- Copay or co-insurance: copay being a flat fee you pay for care and co-insurance a certain percentage you pay for care.
- Other Costs: If your out-of-network doctor charges more than other doctors in the area, you would have to pay the balance after the insurance pays its share.
Note that there is little to no paperwork if you see designated doctors.
Exclusive Provider Organization
With the exclusive provider organization (EPPO), you get to the following;
- Moderate amount of freedom to choose health care providers.
- There is no coverage for out-of-network care providers except for emergency cases.
- You get a lower premium than a PPO that is offered by the same issuer.
With the EPO, you get to pay the following;
- Premium: The monthly payment for insurance.
- Deductible: Some EPO’s may have deductibles.
- Copay or Co-insurance: Copay is a flat fee you pare for care while co-insurance is a percentage you pay from the cost of care.
- Other costs: If you see out-of-network care providers, you will have to pay the full bill.
There is little to no paperwork involved with an EPO.
