The term health insurance is generally used to describe a form of insurance that pays for medical expenses. It is sometimes used more broadly to include insurance covering disability or long-term nursing or custodial care needs.

Comprehensive Health Insurance vs. Scheduled Health Insurance

Comprehensive health insurance pays a percentage of the cost of hospital and physician charges after a deductible or a co-pay is met by the insured. These plans are generally potential benefit payout one to five million.

Scheduled health insurance plans are not meant to replace traditional comprehensive health insurance plans. This type of health insurance is a basic policy providing access to day-to-day health care such as going to the doctor or getting a prescription drug. They generally pay limited benefits amounts directly to the service provider. Annual benefits maximums for a typical scheduled health insurance plan are $1,000 to $25,000.

Important Definitions That You Should Understand When Shopping Health Insurance

Deductible: The amount that the patient must pay before the health insurance plan begins to pay its share. For example, a patient might have a $1000 deductible per year, which means that the patient must pay the first $1000 in medical expenses per year.

Copayment: The amount that the patient must pay at each visit or service with a doctor. For example, a patient might pay a $45 copayment for a doctor's visit, or to obtain a prescription. A copayment must be paid each time a particular service is obtained.

Coinsurance: The alternative to a Copayment is coinsurance, the patient is responsible for a percentage of the total cost. For example, the member might have to pay 20% of the cost of a surgery. So, if the surgery cost $10,000, the patient would pay $2000.

Premium: The amount the patient pays to the health insurance company each month for the medical coverage. Exclusions: The patient is expected to pay the full cost of service that are exclusions.

Out-of-pocket maximums: Similar to coverage limits, except that in this case, the member's payment obligation ends when they reach the out-of-pocket maximum, and the health plan pays all further covered costs.

Coverage limits: Health insurance plans typically only pay for medical care up to a certain dollar amount per year and/or over the lifetime of the coverage.

In-Network Provider: A health care provider on a list of providers preselected by the health insurance company. The health insurance company will offer discounted copayments or coinsurance, or additional benefits, to see an in-network health care provider. Providers in network are providers who have a contract with the health insurance company to accept discounted rates.

Capitation: An amount paid by an insurer to a health care provider, for which the provider agrees to treat all members of the insurer.

Prescription Drug Plan: This type of plan allows patients to make a copayment for prescription drugs.

Amerisave and all affiliated companies make no warranty and take no responsibility for the accuracy of the information found on this website. All information should be verified with your insurance carrier.