Health insurance- Definition, Types, and Benefits

Health insurance is among the most important coverage you could get for yourself and your family.

Critically speaking, health insurance is a form of self-love which you also extend to your loved ones.

Regardless of the good health you enjoy, you still need some form of coverage to help you stay afloat during a health emergency.

And truthfully speaking, a health crisis is among the few incidents that can quickly wipe out your entire savings and leave you broke, sick, and shocked.

But with health insurance, your health crisis becomes halved so you do not have to worry too much about medical bills.

Now, let’s find out what health insurance is all about and how it can help you to take care of your health.

What is health insurance?

Health insurance is a type of coverage where an insurance provider takes care of all or some of the policyholder’s medical bills while the policyholder pays their premiums.

Most health insurance companies decide on what type of health issues and medical bills they will cover for policyholders. Also, the accompanying premiums may be expensive with the co-pays, and deductibles.

This is why anyone looking for coverage must shop long and smart for quotes.

Quotes help you select the right insurance company that provides all you need for you to enjoy peace of mind.

Again, you can purchase health coverage through the marketplace or government-owned health care services.

How does health insurance work?

Health insurance companies work hand in hand with some hospitals to treat their patients. They form a network within themselves so that the policyholders can access the services of the health care institutes or hospitals from their respective locations.

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Ultimately, a policyholder has to only present an insurance card at the hospital, and immediately the doctors commence treatment.

The services that policyholders can readily access includes: Doctor’s visit, hospital bed space, surgery, and refilling prescription drugs.

Furthermore, most insurance companies would rather reimburse their policyholders after they’ve paid hospital bills, while others pay the hospital bills directly to the hospital the policyholder used.

However, policyholders who go away from these networks will cover their medical bills themselves or pay a higher percentage for the cost of medical services they received.

Who needs health insurance coverage?

Just about everyone needs this coverage. First, if you are the type that takes life and health seriously, then, health coverage should be a necessity.

Additionally, people with families and kids need this coverage to cushion kids’ unpredictable health challenges.

Types of health insurance

This coverage comes mostly in different types; public and private health insurance is the most popular. Then, other kinds can serve as a type of coverage as well.

Private health care insurance

The private type is owned and funded by individuals or organizations with a common goal of providing health care coverage for people. Though this type of health care coverage can be expensive yet it provides more options and better services for the policyholders.

Public health care coverage

Meanwhile, the public health care insurance program is funded by the government. The government has reduced the price of the services or made them free for the people. This approach has helped families and individuals with low income or out of jobs access health care when needed.

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So, the government uses some avenues to provide health care coverage to people. Through the Affordable Care Act also called the Obama Care, Medicaid or Medicare, Children’s Health Insurance Plan (CHIP). 

Medicaid

Medicaid has been around for some time now. It is a federal-state program slated to provide health care services to individuals and families that survive on a low income. It helps them have access to medical care since they can not afford private coverage.

Additionally, the requirements for qualification for this service are not the same throughout America. Each state has what works for them.

Furthermore, Medicaid offers numerous services for about 81.9 million people enrolled in the program at no cost at all, or for a low premium.

This program offers medical care coverages like

  • Prescription drugs refill
  • Outpatient and inpatient hospital care
  • Occupational therapy
  • Dentist visits
  • Home health services

Medicare

Medicare is another health insurance program that focuses more on the elderly over 65 years. Also, Medicare provides health care coverage for disabled younger people.

This health care program is a federal program in America and the same in all states, unlike Medicaid.

Health Maintenance Organization

A health maintenance organization is made up of a network of health care insurance providers. Medical doctors and other health practitioners, alongside health insurance companies, come together to provide coverage for people enrolled in it.

HMO is a means for anyone in need of health coverage to pay low monthly premiums or out-of-pocket payments for their medical needs.

Preferred Provider Organization

The preferred provider organization is yet another network of health care professionals and health insurance companies. People under this organization visit any of the in-networks to access medical care for a subsidized premium.

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High Deductible Health Plan 

High deductible health plans provide low premium coverage for medical care. However, the insured individual must pay a higher amount of money as an out-of-pocket payment at first, before the plan kicks in.

This particular plan offers wider coverage of medical health services and the premiums may vary each year. Also, the plan allows for a health savings account.

A high deductible health plan can cover much preventive care like screenings, counseling, vaccines, and therapies.

Benefits of purchasing health insurance

This coverage is a must-have in this day and age because it comes with lots of benefits and almost no disadvantages to it.

With this coverage, you stand to gain these benefits

  • Peace of mind
  • Access to quick medical help
  • Financial coverage
  • Access to professional health care providers
  • Professional management for pre-existing medical conditions
  • The choice to use any professional in the in-network range
  • Preferential treatment
  • Savings

Conclusion

Health insurance saves you a lot of stress from paying a lot of money to hospitals for health care, health emergencies, or managing pre-existing conditions.

Many health insurance companies sell health care coverage to individuals at a high price and also, join medical professionals to provide health care services at a lower rate for insured people. 

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