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An Easy To Understand US Health Insurance Guide

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(Credit: Pexels) An Easy To Understand US Health Insurance Guide
October 5
3:44 PM 2020

US healthcare can easily become very expensive. Just a simple visit to a doctor's office can end up costing hundreds. The average 3-day hospital stay tends to cost thousands of dollars. Most people simply cannot afford such large sums. This is why health insurance is simply mandatory in order to reduce costs to amounts that are reasonable.

The problem is that US health insurance is very complicated. With this in mind, HealthQuoteInfo shares the most important things to be aware of below.

Provider Access Is Dictated By Health Insurance Providers

Many health insurance plans are controlling costs by influencing provider access, including hospitals, pharmacies, laboratories, and physicians. Insurance companies have contracts with some providers. This is why you need to always be aware of this. When the provider is not included in the network of the health insurance company, payments might not be offered for the services that were offered. Alternatively, smaller amounts might be given.

Plan Coverage Can Vary A Lot

In the US, healthcare reform introduced standardization. Before this was the case, benefits were hugely varied from one plan to the next. The experts at Life Ant explain that most health insurance companies considered the value of life insurance that a person has when quoting a plan. As an example, there were insurance plans that covered the prescriptions but most actually did not. Nowadays, the US plans are required by law to offer the essential health benefits. These include hospitalization, emergency services, tests, newborn care, maternity care, mental health treatment, substance abuse treatment, prescription drugs, pediatric services, outpatient care, rehabilitation services, and prescription drugs.

Costs

It is not that easy to properly understand health insurance coverage. There is normally a premium you pay in order to enroll in a specific plan. This is 100% transparent. However, there are other costs that are not properly presented. Such a cost becomes obvious when care is accessed. Examples include deductibles, copays, and coinsurance.

Generally speaking, the more money is paid for the upfront premium, the less is going to be paid when care is accessed.

Insurance Terms To Understand

There are some interesting insurance terms that have to be understood, including:

  • Out-of-pocket expense - This is also known as cost sharing and usually refers to how much you have to pay when you receive care. The amount is different from monthly premium.

  • Annual deductible - This is how much you pay every single year before the insurance firm pays its share. When the deductible is, for instance, $1,000, you need to pay the very first $1,000 you receive in health care each year.

  • Copayment - Also known as copay, it is an upfront amount that you pay when you are offered care if the care is subjected to copayment. As an example, a $30 copayment might be needed for doctor visits. You pay that when you go to the doctor and the insurance provider will cover the rest.

  • Coinsurance - This is simply a percentage of medical care cost. For instance, if an MRI costs $1,000, you might only have to pay $200 in the event that the coinsurance is 20%. It is the insurance company that makes the other $800 payment needed to cover the treatment.

Covered Benefit

Special consideration needs to be put on this term. It is often used in the industry but it is particularly confusing. What it means is a specific health service included under premium for a specific health insurance policy you pay. Covered practically means a part of allowable health service cost is considered for payment. Never think that it means the insurance company is going to pay everything that is covered. This needs to be precisely written in the contract in order for you to be aware of it. Be particularly careful with this. 

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