Important Words to Know When Buying Health Insurance
Health insurance is one of the most important purchases that a person makes. Unfortunately, selecting a personal health insurance plan is a complicated process, and you may find it difficult to decide what type of coverage is best for you. The following terms are among commonly used vocabulary for insurance companies. Understanding their meanings can lead to an informed decision about your personal health insurance plan.
Group - Health insurance that you receive through your employer, a union, a social organization or other group.
Individual - Health insurance that you purchase on your own.
Premium - The fee that you pay to an insurance company to cover the cost of your coverage. If you have a group plan, the premium is usually deducted from your paycheck. If you have an individual plan, you'll pay the premium yourself on an annual, semi-annual, monthly or biweekly basis.
Copayment - Set dollar amount that you pay to a health care provider at the time that they provide services.
Deductible - Fixed dollar amount that you must pay out-of-pocket before your health insurance plan will cover the cost of your care.
HMO - Type of health insurance in which you must visit a physician or hospital from within an approved network; typically does not have deductibles; stands for health maintenance organization.
PPO - Type of health insurance with greater flexibility in terms of choosing a physician; often has deductibles; stands for preferred provider organization.
Preexisting Condition - Health condition that you have prior to applying for health insurance. With a group policy, you typically cannot be denied coverage for a preexisting condition if you sign up during your company's open enrollment period. With an individual policy, you may be denied coverage for preexisting conditions, or the conditions may not be covered until a certain amount of days after the policy's effective date.
Health insurance is collectivism in regards to health care expenses and medical fees. A group of people buy into a health coverage plan as either a group or individual consumers, to insure that they can afford health care in case they get sick or in case of an emergency. Each party pays a premium so whenever they go to a doctor's office for a visit or checkup, they can pay a small deductible instead of a large bill. There are many debates about health care in the United States and the rest of the world, but it is an important thing to have for you and your family.
Health insurance can mean and cover a wide variety of plans. You can buy an insurance plan for a group, such as a business, or get individual plans for members of your family. There are private health care coverage plans and government sponsored plans. Most universities even have their own health care plans for attending students.
Also, different types of health coverage plans cover different types of services. While some PPO's cover hospital bills, other HMO's are more comprehensive and also cover dental visits. Check to see if your company's insurance covers dental, vision, and other members of your family or if you will need to purchase separate individual plans.
It is prudent to do some research about the health insurance business before making any commitments. Access your favorite online search engine and type in related keywords such as health quotes, insurance plans, hospital deductibles, and doctor visits. Find out as much information about this industry so you can make an informed decision.