Health insurance is a type of insurance coverage that pays for medical, surgical, and sometimes dental expenses incurred by the insured. Health insurance can reimburse the insured for expenses incurred from illness or injury, or pay the care provider directly.
It is often included in employer benefit packages as a means of enticing quality employees, with premiums partially covered by the employer but often also deducted from employee paychecks.
The cost of health insurance premiums is deductible to the payer, and the benefits received are tax-free.
KEY TAKEAWAYS
- Health insurance is a type of insurance coverage that pays for medical and surgical expenses incurred by the insured.
- Choosing a health insurance plan can be tricky because of plan rules regarding in- and out-of-network services, deductibles, co-pays, and more.
- Since 2010, the Affordable Care Act has prohibited insurance companies from denying coverage to patients with pre-existing conditions and has allowed children to remain on their parent’s insurance plans until they reached the age of 26.
- Medicare and the Children’s Health Insurance Program (CHIP) are two public health insurance plans that target older individuals and children, respectively. Medicare also serves people with certain disabilities.
How Health Insurance Works
Some Points Are Here
Point-1
- Health insurance can be tricky to navigate. Managed care insurance plans require policyholders to receive care from a network of designated healthcare providers for the highest level of coverage. If patients seek care outside the network, they must pay a higher percentage of the cost. In some cases, the insurance company may even refuse payment outright for services obtained out of network.
Point-2
Point-5
These plans have lower premiums than an equivalent health insurance plan with a lower deductible. One other advantage: If you have one, you are permitted to open and contribute pre-tax income to a health savings account, which can be used to pay for qualified medical expenses.
Special Considerations
In 2010, President Barack Obama signed the Patient Protection and Affordable Care Act (ACA) into law. In addition to these changes, the ACA established the federal healthcare Marketplace.
Medicare and CHIP
Two public health insurance plans, Medicare and the Children’s Health Insurance Program (CHIP), target older individuals and children, respectively. Medicare, which is available to tho-sage 65 or older, also serves people with certain disabilities. The CHIP plan has income limits and covers babies and children up to the age of 18.
Courtesy: Lnvestopedia
