Health Insurance Is A Right, Not A Privilege.
The threat to health is always present no matter the age, occupation or circumstances. In some cases, the threat is higher while in others not so. For example, with age, the health tends to deteriorate. Similarly, people involved in certain occupations tend to have more health issues like those working as miners or in the asbestos industry etc. Again circumstances also expose people to hazardous materials, knowingly or unknowingly, causing ill health. All in all, individual health is a matter of utmost importance. Consequently, health care insurance is a must. In most developed countries, Government Health Insurance programs are in place to guarantee all citizens at least basic and affordable health care.
In this post, we shall try and understand health insurance and all that it represents. The idea is to make sure that each and every one of us can completely understand its core.
Health Care Insurance or Health Insurance is…
… insurance that covers the whole or a part of the risk of a person incurring medical expenses, spreading the risk over a large number of persons[i]. This being the definition of health insurance in the typical insurance jargon which most of us will find difficult to understand. Let us now try and understand it simply.
Suppose you fall ill or get injured. The expense of treatment might be high (not always so). In such a case, it might be difficult for you to bear the entire expense. Expense here means the money spent on medical aid. You can get health care insurance to spread your financial risk. If the medical expenditure goes over a certain value (fixed by the insurance contract) the insurance company or the Government will bear a part of it. This is health insurance for you in short. It includes payments for doctor visits, stay in the hospital, the cost of prescription drugs and also preventive care.
Hence, it can be rightly said that a healthcare policy will cover, in part, medical and surgical expenses incurred by the insured. It will also cover any post-operative care that might be required at home.
Who Is Eligible For Health Care?
Take a breath of relief because there are no eligibility criteria for health care insurance. It is everybody’s right. If you are not financially well off, you can opt for the basic medical help plan offered by the Government. Else, you can buy one tailor-made to meet your needs. There are no qualifications for entitlement to get medical insurance.
Who Is The Provider?
As the name itself suggests “Provider” is “somebody who provides”. In medical or healthcare insurance “Provider” is the health professional who provides the healthcare services. This term includes doctors, nurse practitioners, physical therapists, psychologists etc. In a nutshell, every person who is directly involved in medically treating an illness or injury is the “Provider”.
The key is to remember, for any health care or medical insurance policy to remain valid and legally binding, the “Provider” has to be a certified healthcare professional.
Choosing The Right Health Care Plan
There are many companies in the market offering medical insurance. But, not all might be suitable for your needs. Even the Government offers affordable health care options to individuals who cannot afford to buy a policy for the same. But that does not mean that you do not buy a better health plan for yourself. So, if you wish to upgrade from the Governments basic but affordable health care option, here’s what you must look for.
- Your Network of Health Professionals Should Be Included – A health care plan always works with a network. That is, it includes a group of hospitals and clinics, doctors, and other healthcare professionals. Logically speaking, in your hour of a medical emergency, you will always go to a hospital or a doctor near you. And this is exactly why your network of healthcare professionals should be included in the policy.
- Your Pharmacy Should Be Included In Network – Again a whole network of pharmacies will be included in a medical insurance plan. But the key question is whether the pharmacy near you or your preferred pharmacy is included or not?
Any visits outside the network offered by the insurance policy will cost more.
- Plan Should Cover Continuing Medical Needs – It is not necessary that at the time of purchasing a health care policy you are in the best of your health. It might be so that you suffer from a medical condition that you are still undergoing treatment for. In such a case, your new medical policy should continue to cover the expenses for any continuing and new health problems.
- Plan Should Cover Your Prescription Drugs – Every health plan just covers a specific list (formulary) of drugs. Any drug that is not on this list will not be covered. Consequently, always check the plan formulary to make sure that it covers the drugs or medicines you take.
- Plan Should Cover You While Travelling – It is not possible that you always stay in one place. There will be times when you travel for work, leisure or necessity. While traveling you can fall ill or meet with an accident. Hence, ensure that your health care plan will remain effective even when you are in transit. Often services outside the service area of your plan are not covered. But at a higher premium, you can add an addendum to cover some providers in other counties or states where you tend to travel more often.
- Additional Tools To Stay Fit – A good individual health insurance policy should have tools for price comparison between hospitals, practitioners etc. It should also offer online medical assistance etc. Hence, be inquisitive and find out what more the insurance company can offer you.
How Health Insurance Works
There are two primary ways in which a health insurance policy works.
- Limited Liability – if the expense exceeds the lower limit as defined under the policy, the insurance amount will come into play. For example, your contract with the insurance company states that you shall bear all expenses up to $10,000. Any expense beyond this amount will be borne by the insurance company. However, there is a catch. The catch is that an upper limit is also specified. So, the insurance company will only pay up to that specified upper limit. An expense beyond that upper limit will again fall back into the lap of the insured.
- Co-insurance – This is a more popular type of health insurance policy. As an insured, you need to pay a fixed amount towards your health care before your policy begins to pay. This amount is also known as the “deductible”. So, you first pay the deductible amount before the co-insurance kicks in. Say, if your co-insurance is 30%, you will pay only 30% of the expenses beyond the deductible. The benefit of co-insurance is that there is a fixed “yearly out-of-pocket maximum”. Once you have paid 30% of your health care costs and reached your “yearly out-of-pocket maximum”, the rest will be paid by the insurance company.
Individual health is a matter of grave concern. Rising cost of medical bills is a sure indicator of how expensive it is getting a good treatment. A good health care policy or medical insurance policy will go a long way in giving you peace of mind. But choosing the right policy is in your hands. You are now armed with all information relevant to making a judicious decision. So choose well and live long.
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