4 Basic Health Insurance Terms
This article will cover the 5 basic terms used in the health insurance industry:
-Coverage
-Co-Pay
-Deductible
-Premium
If you have never been concerned with health insurance, feel that the time may never occur when you may need it, or if you are unsure about considering purchasing a policy due to lack of knowledge, then please continue reading.
Coverage
The most essential term that you should know is “coverage.” Coverage determines what your provider will cover and how much it will cover. Your plan will show you what tests, prescriptions, treatments, medical facilities, and/or doctors are covered through your provider.
Co-Pay
When you go to a clinic, the doctor, nurse, and other staff members need to be paid. Co-pay is a fixed dollar amount that a policyholder pays in order for a him or her to see a doctor or receive prescription cost benefits. This means that when you are covered with a health insurance provider, you will only pay a certain number of dollars (depending on your plan) to get a medical service.
For example, if you see the doctor regularly for a migraine headache and your plan has a co-pay of $20 per doctor visit, then you will only pay $20 per visit, even if the doctor or clinic charges $60 per visit. This means that $40 is covered by your provider.
Deductible
Of course, some companies take a big risk when dealing with individuals whose medical history is a mystery. In order for the insurance company to insure themselves, they must issue a deductible amount. The deductible is the amount the policyholder pays every year in order to be covered. After the policyholder pays this amount, he or she will be reimbursed for any outstanding doctor or hospitalization fees that arise.
Premiums
People with higher deductibles usually pay a lower premium and vice versa. A premium is the regular payments that you make in order to protect yourself under your provider. Premium costs may be affected by your medical history, your current health state, and other factors. Although they may vary, you will be comfortable knowing that you are covered in the event of an accident.
Tags: Basic Health Insurance Terms, health, HEALTH INSURANCE, Insurance
