There are many different kinds of health insurance policies you can purchase out there. However, perhaps the most important and relevant to your daily life is health insurance. Health insurance can save your life both in terms of your physical health and your financial well-being.
However, despite how important health insurance is, not many people know a lot about how it works. Below are some things you should know.
Everyone Needs Health Insurance
No matter who you are, you should not go without health insurance coverage. Many young people may think they are invincible. This is certainly not the truth. Even if you rarely went to the doctor before, that could all change due to a sudden injury or illness.
Not going to the doctor to avoid expenses is never a good idea. You may end up not having something vital to your health detected early enough to make a difference. Everyone needs healthcare, and health insurance is needed because it makes healthcare affordable. Without it, your savings could easily be wiped out by medical costs.
What Are Premiums and Deductibles?
Two important elements of any health insurance plan, or probably any insurance plan in general, are premiums and deductibles. Insurance companies, like any business, have to make money. One way they do that is by charging customers a deductible and premiums.
Premiums can be thought of as the monthly bill you receive for simply having specific insurance coverage. Alternatively, a deductible is an amount you have to pay for covered medical services before your insurance will kick in and start paying for the expense.
The amount you pay for either tends to rise and fall in an inverse fashion. Higher premiums may mean a lower deductible and vice versa. Over time, the amount people pay in their deductible has been steadily increasing.
What Are Copays and Coinsurance?
Two other terms you should understand in the context of health insurance include copay and coinsurance. A copay is a fixed amount that you have to pay for specific kinds of medical care. For example, you may have a copay of $25 for doctor’s visits.
Coinsurance is a bit different. Instead of paying a specific amount for kinds of care, you pay a percentage of the cost. For example, your coinsurance rate maybe 20% for certain kinds of care. If the bill was $100, you would end up paying $20 as a result.
Make sure you know if an insurance plan has copays or coinsurance and the amounts and percentages involved. Only knowing about the premiums and deductibles is not enough. A certain plan may not be as good of a deal as you thought.
What Are Health Insurance Quotes?
The process of buying health insurance has its own peculiarities as well. One of these is the process of obtaining insurance quotes. Quotes in this context refer to being “quoted” a specific price in regards to premiums, the deductible, and more in regards to the insurance coverage available from a specific insurer in a certain plan.
This quoted price is an estimate and may not completely reflect what a person ends up paying for after signing an insurance contract. Quotes can be obtained in different ways including talking directly with an insurance agent or receiving one over the phone, through email, through the mail, or with the use of an insurance calculator.
Online health insurance quotes, for example, are one of the most popular means of obtaining quotes for this kind of insurance.
What Is the Health Insurance Marketplace?
How health insurance works were reformed by congress during the Obama administration. These reforms set up something known as the Health Insurance Marketplace for those that do not have health insurance through their employers and would have trouble obtaining it otherwise.
Through this law, health insurance exchanges are set up in individual states that assist citizens in obtaining the necessary health insurance coverage. In certain states, the exchange may be operated in cooperation with Medicaid.
In others like New York and California, the exchange is completely managed by the state. If you act during the enrollment period, you can use such an exchange to obtain an insurance plan even if you have significant financial struggles.
Overall, everyone needs health insurance. You should think of it as a necessity. However, don’t rush into purchasing just any plan. Instead, do your research so you better understand how it works so you can purchase the best coverage for you and your family.
Author: Stephanie Caroline Snyder
Stephanie Caroline Snyder is a 27-year-old who graduated from The University of Florida in 2018. She majored in Communications with a minor in mass media. Currently, she is an Author and Writer. She was born and raised in Panama City, Florida, where her family still lives.