What is Health Insurance?
Health insurance is a type of insurance that covers the costs associated with medical and surgical expenses of an insured person. Health insurance policies can vary greatly in terms of coverage and cost, and they may be purchased by individuals or provided by employers as a benefit. Health insurance can cover a range of healthcare services, including preventative care, doctor visits, prescription drugs, hospital stays, surgeries, and more. Health insurance can help individuals and families afford the high costs of medical care, and it can provide financial protection in case of unexpected illness or injury.
Types Of Health Insurance
Indemnity plans: Also known as fee-for-service plans, these plans allow you to choose your doctors and hospitals without needing a referral. However, they often have higher out-of-pocket costs and may require you to pay for services upfront and then submit a claim for reimbursement.
Health Maintenance Organizations (HMOs): HMOs require you to choose a primary care physician (PCP) who will manage your healthcare and refer you to specialists if needed. They often have lower out-of-pocket costs, but you may have limited choices in terms of doctors and hospitals.
Preferred Provider Organizations (PPOs): PPOs also have a network of providers, but you have more flexibility in choosing doctors and hospitals outside of the network. However, going out-of-network usually means higher out-of-pocket costs.
Point of Service (POS) plans: These plans combine features of HMOs and PPOs, requiring you to choose a PCP but also allowing you to see providers outside of the network for a higher cost.
High Deductible Health Plans (HDHPs): These plans have lower monthly premiums but higher deductibles, which means you'll pay more out-of-pocket before insurance coverage kicks in. They often come with a Health Savings Account (HSA), which allows you to save pre-tax money to pay for qualified medical expenses.
