Health insurance, like other forms of insurance, is a form of collectivism by means of which people collectively pool their risk, in this case the risk of incurring medical expenses. The collective is usually publicly owned or else is organized on a non-profit basis for the members of the pool, though in some countries health insurance pools may also be managed by for-profit companies.
Health Insurance plans protect you and your family by offering complete health & medical insurance coverage. It takes care of medical treatment costs incurred during hospitalization due to serious accident or illness.
Why Health insurance?
Medical expenses have increased. Common man has to stretch to uncomfortable financial limits to get proper treatment for himself and his family.
How it works?
A health insurance policy is a contract between an insurance company and an individual or his sponsor. The individual insured person's obligations may take several forms:
Premium The amount the policy-holder or his sponsor (e.g. an employer) pays to the health plan each month to purchase health coverage.
Deductible The amount that the insured must pay out-of-pocket before the health insurer pays its share.
Co-payment The amount that the insured person must pay out of pocket before the health insurer pays for a particular visit or service.
Coinsurance Instead of, or in addition to, paying a fixed amount up front (a co-payment), the co-insurance is a percentage of the total cost that insured person may also pay.
Exclusions Not all services are covered. The insured person is generally expected to pay the full cost of non-covered services out of their own pocket.
Coverage limits Some health insurance policies only pay for health care up to a certain dollar amount. The insured person may be expected to pay any charges in excess of the health plan's maximum payment for a specific service.
Out-of-pocket maximums This is similar to coverage limits, except that in this case, the insured person's payment obligation ends when they reach the out-of-pocket maximum, and the health company pays all further covered costs.
Capitation An amount paid by an insurer to a health care provider, for which the provider agrees to treat all members of the insurer.
Prior Authorization A certification or authorization that an insurer provides prior to medical service occurring.
Explanation of Benefits A document sent by an insurer to a patient explaining what was covered for a medical service, and how they arrived at the payment amount and patient responsibility amount.
Things to consider in making the best choice for Health insurance
Choices What are the various types of health insurance programmes that are available to me, and which is best suited to suit the needs of my family and myself?
Budget You also need to consider how much you can afford, this affect how much coverage you can get.
Discounts, incentives, promotions To lower your premium ask for discounts, incentives offered or any type of promotion you can take advantage of. This way you can save money on your policy.
Type of insurance company One consideration is the type of service, reputation and stability of the company.