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Health Insurance Plan

Health insurance is an important asset to have, though often a difficult endeavor in these tough economic times. It is there to both assist in keeping us healthy and it protect us in the event of a major medical emergency. But it can be difficult to understand the specifics of health insurance plans-- what kinds are offered, how they work and what you get for your money. The smartest way to approach this confusion is to research before you buy, know what kind of policy it is you are seeking and learn the language of the right insurance plan for you.

Below, we've outlined some of the most important parts of any health insurance plan and some terms to remember.

Most companies offer varied plans to suit all needs, those that follow being the most common.

Depending on which health insurance plan you need, explore your options closely and be sure to check one company's offer against another's to ensure you are getting the most affordable insurance for your budget.

Some terms you may want yo familiarize yourself with are listed below and are a part of each style of health insurance.

Check out ourglossary for a complete list of terms

HMO: Short for Health Maintenance Organization. This type of individual health care plan revolves around the premise of preventive care. You pay a small monthly fee to belong and then varied co-pays for doctor care. Upside: This type of plan is often costs significantly less than other forms of coverage. Downside: You are only allowed to select your doctor from an approved list of providers, often leading to long waits for non-emergency visits. Even worse, many HMO's won't cover medical costs incurred through care given outside your provider's network, unless your doc gives you a referral-- a decision entirely made by your insurance company and your doctor.
PPO's: Short for Preferred Provider Organization. PPO's differ from HMO's in that you are allowed to choose your own provider from any network and are able to see a specialist or use emergency care without a referral. Downside: Often more expensive than HMO's, both in monthly costs and out-of-pocket expenses.
POS: Short for Point of Service. A newer hybrid of HMO and PPO with the freedom of choices a PPO provides but with HMO pricing.
Premiums: A premium simply means this: it is the money you pay each month to keep your insurance up to date. These are determined by various factors, not the least of which is your medical history (and your maternal/paternal family's), your current lifestyle (if you smoke, how often you exercise, etc.) and whether or not you have any pre-existing medical conditions to contend with.
Deductible: The deductible is the amount of money you pay to your insurance company before your health insurance coverage comes into effect. For example, if you find you need surgery suddenly for a herniated disk, then you must pay your deductible before your insurance company will cover your surgery fees. Policy deductibles range from zero to over $2,000 depending on what you choose at the outset of your policy. However, note that generally, the higher the deductible, the lower the monthly premium, and vice-versa.
Co-Pay: Co-pays are fixed charges your insurance company applies to basic care like doctors visits and pharmaceutical care. They range from $0-$75 and you would be wise to research these carefully when selecting an insurance policy online, especially if you have a large family health insurance plan or are seeking self-employment health insurance or a policy for your small business.
Co-insurance: Co-insurance is the percentage of money your company expects you to pay beyond the coverage they provide. A common percentage ratio is 80% company coverage, 20% your out-of-pocket plus your monthly premium and co-pay.