Millions of people purchase health insurance policies to protect themselves and their families in case of an emergency. However, choosing the right policy can be difficult. Here's what you need to know.
What is health insurance and why do you need it?
Health insurance is a type of insurance that helps to cover the costs of medical expenses. It can help to pay for hospital stays, doctor visits, prescriptions, and other medical treatments.
What are the different types of health insurance?
There are many different types of health insurance plans available, including:
- Preferred provider organization (PPO). A PPO is a type of health insurance plan that allows you to see any doctor or provider that accepts the plan, but you will pay less if you use a doctor or provider that is in the plan's network.
- Health maintenance organization (HMO). An HMO requires you to see a primary care doctor or provider for all your medical needs first so they can coordinate services. You will usually have to choose a primary care doctor or provider from the plan's network.
- Exclusive provider organizations. An exclusive provider organization (EPO) requires that you only see doctors or providers who work for the EPO. Nothing is covered outside of their group.
- Point of service plan. A point of service (POS) plan is a type of health insurance plan that allows you to see any doctor or provider, but you will pay more if you use a doctor or provider that is out of the plan's network. It tries to combine the benefits of an HMO and a PPO.
What are some things to consider when choosing a health insurance policy?
When you are choosing a health insurance policy, there are a few things you should consider, including:
- Premium. The premium is the amount you pay each month for your health insurance.
- Deductible. The deductible is the amount you have to pay for medical services before your health insurance starts to pay. For example, you may have a high deductible policy that requires you to pay a $5,000 deductible each year before your health insurance kicks in.
- Co-insurance. Co-insurance is the amount you have to pay for medical services after you have met your deductible. Using the example above, after you pay your $5,000 deductible, you may have an 80/20 co-pay. This means that for every dollar in medical expenses over $5,000 you incur, your health insurance will pay 80 percent, while you pay the remaining 20 percent.
- Co-payments. In addition to deductibles and co-insurance, some health insurance plans have you pay a co-payment every time you visit a doctor. Co-payments are the set amount you pay for certain medical services, such as doctor visits or prescriptions. They are typically nominal fees.
In addition to understanding what your costs will be for a health insurance plan, you must make sure your needs are covered. Some policies cover chiropractor care, for example, while others do not.
Choosing the right health insurance plan can be confusing, Talk to an insurance agent today and get your questions answered.