It’s no secret that health care is expensive today, without insurance many families would be one health setback away from financial ruin. Regularly paying a set premium for health coverage assures that money will be available to defray the cost of everything from routine checkups to catastrophic medical bills, there is also an increased emphasis on the role of consumers in managing their own health care and health care finances. There is now a focus on providing information on the cost of care and health care quality—at the level of the physician, physician group, and hospital—to help consumers and employers choose among the many options available to them.
Before you choose a health insurance there are fews important things you must know-
“What Are Copayments,Deductibles And Coinsurance – And How Do They Differ From One Another?”
A “copayment” or “copay” is a specific dollar amount that you may have to pay for an office visit or a prescription drug.
A “deductible” is a dollar amount that you may be required to pay out-of-pocket each year before the health insurance company pays medical bills for some covered services. Plans may have separate individual and family deductibles and/or deductibles for separate services such as hospitalization.
“Coinsurance” usually describes the percentage of a total bill that you may have to pay for certain services.
First, keep in mind that not every plan has a deductible or coinsurance – though many high quality plans do. Lastly, keep in mind that some plans have more than one deductible. For example, a health insurance plan may have a standard deductible that applies to most medical services and a prescription drug deductible thatonly applies to prescription drugs.
Major Types of Health Plans
Most health insurance plans fall into one of three categories. In order to choose the best plan for you and your family, you should understand the difference between these major types.
Health Maintenance Organization (HMO) HMOs have a network of providers that you must use in order to be covered and not pay additional costs. If you have doctors or another provider that you use now, you should be sure they are in the network before you enroll in the HMO. Also, an HMO’s network of providers are located within the HMO’s “service area.” If any family members you want to cover do notlive in the service area, an HMO may not be a good choice for you.
Preferred Provider Plan (PPP)
PPPs also have a network of providers, but (unlike an HMO) will cover and pay for services for out-of-network providers. The benefits are usually greater for the network providers. If your usual providers are in the network, but you want to have the option to go to other providers, a PPP may be a good choice.
Major Medical or Indemnity Plans
These plans cover services with any licensed health provider. This may be a good plan if you have family members outside the HMO’s or PPP’s service area, or if your providers are not in the network. Indemnity insurance is often calledfee-for-serviceor traditional health insurance. This type of coverage generally assumes that the medical provider (usually a doctor or hospital) will be paid a fee for each service provided to the patient—that is, you or a family member covered under the policy. With fee-for-service insurance, you go to the doctor of your choice, and you submit aclaim to the insurance company for reimbursement. Often, your doctor or hospital will submit the claim for you. You will only be reimbursed for “covered” medical expenses; that is, the covered services listed in your plan’s benefits summary.
Remember when comparing different plans, put your family’s medical needs under the microscope. Look at the amount and type of treatment you’ve received in the past. Though it’s impossible to predict every medical expense, being aware of trends can help you make an informed decision.