In the present world where medical services and prescriptions are becoming costlier and difficult to afford health insurance plays a great necessity. Just like our other forms of indemnity, health insurance is also the collection of premiums by means of which people secure the health risks (medical expenses) that they might encounter.
The health insurance plan is actually an agreement between an individual or a sponsor (employer) and the health insurance company who would compensate or pay for most or all of the medical expenses incurred by the individual. These health coverage plans usually work by paying monthly, quarterly, half yearly or yearly premium. This contract can be renewed yearly or also kept for life long. The premium and the benefit amount is however decided upon the age of the individual and the time duration of their plan along with the premium amount that is affordable by them.
In some countries we have insurance companies that is public owned, while in others it is organized by a non-profit or by a for-profit company.
Health plans can be divided into four categories: health maintenance organizations, point of service plans, preferred provider organizations, fee-for service plans. We also have prescription plans, health saving accounts, discount plans and so on.
Health maintenance organizations (HMO): is a prepaid plan found in the US. This plan pays for the coverage in advance, instead of paying for each service separately i. E., you pay a monthly premium and in return, you get a comprehensive coverage for you and your family including doctors visit, x-rays, emergency care, lab tests and so on. Depending on the premium you select, HMO will offer range of benefits from dental to vision.
Point of service plan: this plan allows you to manage your plan. This is an option provided by HMO where if your doctor refers to someone outside the network then the plan pays all or most of the bill. If you refer someone out of the network and if that is covered in your plan then you would have to pay coinsurance.
Preferred provider organizations: in this plan you can use the doctors you prefer out of the network and still the plan would cover some part of the bill, but you would land up paying a larger amount. Some people prefer this option, as they don’t have to change their doctors just to join this plan.
Fee-for service plan: as the name says it depending on your service, the hospital would send the bills to the cover company and they will cover that particular expense. For this plan there would be a specific deductible every year, only then the coverage would start reimbursing the expenses.
Individual health insurance is when we take health coverage on an individual basis and not in a group. This can be sold to a single person, a family, or a dependent child or to a parent. Individual coverage generally works out much higher than group coverage. The individual health insurance policy varies for each state. They have their own means of implementing the marketing and selling strategies.
Sometimes health insurance might include dental plan with a much higher premium else it would have to be taken separately. Dental plan is an insurance designed to pay for dental expenses. We have individual, family and group dental plans. If you are self-employed or the insurance provided by your employer doesn’t include dental coverage, then individual dental plans come handy. Like health insurance plans, dental plans also have various types of coverage like HMO dental plans, Preferred provider organization dental plans and so on. There are various plans offered by companies where about 60% of the bill amount would be covered or reimbursed.
There are many healthcare companies like the United Health Care, CIGNA, Aetna, Blue Cross, CHCS Services Inc, Empire Blue Cross and Blue Shield, Continental General Insurance Company, Great – West Healthcare, Harvard University Health Services, Health New England, Chinese Community Health Plan and so on.