Health Insurance

Overview

These days, the cost of healthcare in the United States is sky-high. A visit with a doctor can cost up to $500, and medications can cost hundreds of dollars as well. Emergency room visits are also expensive, costing over $1,000 for many minor situations. If you are hospitalized or need to have surgery, your procedure can cost hundreds of thousands of dollars.

The high costs of healthcare cause substantial harm to society. Many people are unable to afford basic healthcare, and others are unable to pay their bills. If you are unable to pay your healthcare expenses, you may have no choice but to declare bankruptcy.

Health insurance is available to offset some of the high costs of healthcare. A private company or government agency will pay a portion of your medical expenses so that you end up paying a reduced cost. Instead of paying $500 for an office visit, for example, you will pay a copayment that ranges from $5 to $50 depending on your plan.

Many health insurance policies are available through employment compensation plans. When you take a full-time job, you can elect to sign up for health, vision, and dental benefits, depending on the programs that your company offers.

You may need to pay a bimonthly fee, or you may receive benefits at no additional charge. Many employers allow policyholders to add dependents (spouses and children) to the plan. Some health insurance plans allow coverage for domestic partners.

Companies are able to offer health insurance at a low price. When you elect to receive health insurance through your company, you are signing up for what is called a group health insurance plan. Private health insurance plans are available; however, they are substantially more expensive.

Group health insurance plans are available at comparatively low rates because employers are able to negotiate terms and prices with health insurance companies. Also, group health insurance plans cannot discriminate against people based on gender and preexisting conditions. Many private health insurance plans can; however, the government is creating legislation to amend this practice.

How It Works

A variety of health insurance plans are available for different family and medical needs. A preferred provider organization (PPO) is a flexible plan that allows people to choose their doctors and specialists. In general, these plans tend to be more expensive, but policy holders have a high level of flexibility when choosing doctors and treatment. Health maintenance organizations (HMOs) are less expensive than PPOs, but patients do not have the same level of flexibility. With most HMOs, you cannot seek medical care outside of one medical group, and you need a primary care physician's authorization before seeing a specialist. A health savings account (HSA) is a health insurance plan that accompanies a high-deductible PPO. With an HSA, you pay every dollar amount up until a limit. After you reach that limit, your health insurance will become active, and your expenses will become eligible for coverage.

A deductible is the amount that you must spend before your health insurance coverage becomes active. Deductible amounts can vary from $100 to $3,000 depending on your plan. The deductible is annual, which means that you will need to meet that amount before your health insurance becomes active for that year.

Every health insurance plan is different, and the specific terms are available in your contract. You should check to see what is covered ahead of time before choosing a plan.

Health insurance companies negotiate rates with medical providers. The providers without negotiated rates will not be covered by that particular health insurance plan. Check with a health insurance company ahead of time to determine whether your expenses are eligible for coverage.

Benefits

Medical expenses are skyrocketing. Even a minimal amount of health insurance coverage can help you afford emergency situations and routine care. If you are taken to the hospital and have zero health coverage, the entire bill will be your responsibility, and this can sometimes be a burden on you. Though expensive, a health insurance plan can make healthcare costs more affordable.

Cost/Pricing

Your coverage levels are outlined in your health insurance policy. Medical expenses include fees paid to doctors, payments for hospital services, long-term care services, and laboratory fees. The cost of drugs is deductible only for drugs that have a prescription, except for insulin. The premium amount you pay and the plan you choose, determines the extent of your policy's coverage.

Companies/Industries

There are many companies that provide health insurance coverage. Municipal jurisdictions and states around the United States have begun offering different levels of health insurance coverage to help people who cannot afford medical expenses. Health insurance companies that offer these types of policies include Blue Cross Blue Shield, Aetna Health, Humana Healthcare, United Healthcare, Unicare, as well as a number of other companies across the United States.

Timing

If you can afford it, you should have health insurance, even if you do not have any medical problems. New federal legislation specifies that people without health insurance will be subject to fines within the next few years.