Health Insurance and Related Terms

There's all kinds of talk about health insurance these days. For those of you who don't know, health insurance can be defined as something that ensures you will be covered for at least some of the risk when it comes to incurring medical expenses due to illness or injury. There are all kinds of specifics when talking about this subject. Let's go over some of the terms related to this big enterprise so you'll be ready for your next doctor visit among other things.

When it comes to the health insurance industry, there are a few words that one should know. These will come in handy when buying insurance, settling a claim, or just going to see your local doctor.

• Claim:

This is a formal request for payment for health care services or products. Services can include anything related to care. Products are usually prescription medications or items used by the patient for some sort of therapy.

• Copay:

This usually refers to the amount or percentage of the cost the patient is required to pay out of pocket before seeing a doctor or picking up a prescription medication. It can also refer to medical devices among other related products and services.  

• HMO:

The abbreviation stands for Health Maintenance Organization. If you have this type of plan, your PCP or primary care physician oversees all of your care. Also, you will have to pay the full bill out of pocket for providers that are outside of your network. Your network is a list of doctors, hospitals and clinics that you are able to get discounted products and services from.

• PPO:

PPO stands for Preferred Provider Organization. In this type of plan you still have a network, but you will only be responsible for an annual deductible if you go outside of your network for products or services. You don't need to have a primary care physician under this type of plan.

• Group Plan:

Offered by employers and other organizations, group health insurance plans offer better plans for your money because you are normally paying a certain percentage of what the insurance costs your employer. Risk is also pooled amongst all employees, former employees, or organization members, so this also makes it cheaper for some people with health conditions.

• Individual Plan:

This is health insurance plan for one person or the person and their family. Their risk is not pooled amongst several other people, but the plan is usually tailored to be exactly the type of coverage the person or family wants or needs. Group plans may offer some choices, but they are very limited whereas there are several choices when buying an individual plan.

• Premium:

This is the full amount paid for an insurance policy. If you have an individual policy, you will pay the full amount of the premium. The same usually goes for former employees unless governmental action or another rule makes the employer cover part of it for a limited amount of time. Employees pay for only a portion of the premium, as the employer covers the rest. This is why health insurance is often referred to as a benefit for employees.

 

All in all, there is a lot of information and terms when it comes to health insurance in the United States. It is helpful for everyone to know these terms in case you ever get sick or injured, want to buy your own plan or a business policy, or have questions about a company's benefits. 

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