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Health insurance – Health is wealth; save and savor it!
Health insurance
is the type of protective insurance in which the insurer pays the medical
expenses of the person insured if the insured becomes unhealthy or is in need of medical
assistance, due to causes or accidents covered in the policy. The main reason behind the
importance of health insurances is that quality health care is very expensive and by having these
insurances, if you happen to fall seriously ill, there is one less thing to worry about. That is
because the health care insurance company will cover the costs.
This kind of insurance provides coverage for medication, visits to the doctor or ER, hospital
admissions, costs for tests, examinations, prescription drugs and other medicinal needs.
Basically this insurance policy can be divided into two: Fee-of-service Insurance or Reimbursement
(Indemnity insurance), and Managed Care Insurance Plans. And these insurance plans are available
from both private insurance companies and government agencies.
Fee-of-service insurance is a traditional type of insurance that pays a portion of each health
care service you seek, such as doctor's visits and hospital admissions, while you pay the
remaining cost with a monthly premium fee. There are two kinds of fee-of-service coverage - basic
and major medical.
Managed Care insurance plans help you control the costs, whereas the insurance companies sign an
agreement with doctors and hospitals to provide health care services for their members. This type
of insurance falls into 3 basic plans. First is the Health Maintenance Organizations plan that
provides health care treatment on a prepaid basis, which means that HMO members pay a fixed
monthly insurance fee and in return, they get a wide variety of medical services, from office
visits to hospitalization and surgery. Second is the Point of Service plan, which is a type of
insurance where you pay no deductible and usually only a small co-payment when you use a health
care provider within your network. And finally there is the Preferred Provider Organizations
insurance plan, which is a combination of a fee-of-service insurance plan and an HMO plan. When
you visit the doctor, you pay by membership card like in the HMO plan.
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