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21. What Is Health Insurance?

Health insurance provides coverage for any medical expenses you might encounter. Injuries, illnesses, and other conditions that receive treatment from a doctor, nurse practitioner, or qualified professional are part of most plans.

You need health insurance because an accident or injury could happen unexpectedly. Illness can occur at any time throughout the year, and medical expenses can be high. They are the primary cause of bankruptcies in the United States.

There are several different health insurance structures to consider when choosing a policy, either through an employer, by yourself, or on an exchange, so it is vital to know how to support your exact needs.

Understanding the Terms of Health Insurance

Health insurance has a language of its own. You will want to familiarize yourself with these terms to ensure that your coverage will meet your needs.

The first term is “deductible.” This amount is a set figure you or your family must pay toward your medical bills each year before the insurance coverage will start to contribute. Some policies may not have one.

Then you will want to familiarize yourself with the “premium” for your health insurance. This amount is what you must pay monthly to maintain your coverage.

Your “coinsurance” is the amount of your medical bills that you’ll pay after you meet the terms of your deductible. If you have 90% coverage, then the amount you would pay for the services rendered would be 10% of the final amount.

Finally, a “copay” is a flat fee that your policy might require that you pay every time you fill a prescription or visit your doctor. This amount does not go toward your deductible in most situations.

Health insurance provides you and your family with a way to receive the care you need without it being a financially devastating experience. How good is your coverage today?

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