Understanding Your Health Insurance Policy

With the rising costs of health care today, it is vitally important to understand your health insurance policy and the terms under which it operates. Having good health insurance means receiving timely and appropriate health care from a family doctor or medical care facility without having to worry about paying for expensive treatment and tests. While the so-called “safety net” care provided by hospital emergency rooms and neighborhood clinics will give help when needed, this type of health care is fraught with internal problems, long waiting times, and questionable practices. In addition, uninsured individuals are inclined to avoid going to the doctor when they need to because of the cost involved.


The deductible associated with your health insurance policy refers to how much the insured individual has to pay before the insurance begins paying the remaining amount of the specific health care treatment. A deductible is generally a per-year amount, which means once this amount is met, the insured does not have to pay any more out-of-pocket expenses for the rest of the year. Doctor’s office visits are usually available without having to initially pay the deductible. This means that if an office visit costs $60, then the insurance will always pay some portion of this, usually at least half, and the insured will pay a “co-pay” of $30.

Health Maintenance Organization (HMO’s)

An HMO offers the services of a comprehensive health insurance policy which generally includes preventative care screening, immunizations, emergency care, annual physicals, and hospitalization. This type of policy requires that the insured use services that have been validated by a certain network of doctors, hospitals, and other medical facilities. When opting for an HMO, a Primary Care Physician must be selected first, which determines the sort of IPA or Medical Group (network) from which an individual will receive health services. The term “managed care” can also refer to a health maintenance organization.

Preferred Provider Organization (PPO)

Those who provide for health care networks can choose to be contracted as part of a PPO in order to be paid a predetermined amount. As an insured individual holding a Preferred Provider Organization health insurance policy, you can receive treatment from any doctor or other medical professional you choose. However, if the doctor selected does not participate in the PPO network, then out-of-pocket expenses will be higher for the policyholder. The majority of PPO plans do contain a yearly deductible, along with co-payments or co-insurance rates.

Point of Service

When someone has to seek health care services, having a point of service health insurance policy lets them select from one of either two options. The first one allows the use of a policy resembling an HMO plan, which requires the insured to obtain necessary authorizations and referral for certain kinds of care and specific testing. The other option permits someone to obtain their health care from an out-of or in-network doctor, hospital, or other medical facility without managing these provisions through their principle physician. However, using this plan means the insured will be responsible for paying a deductible and sometimes a percentage of treatment costs.

Protecting Your Future

Obtaining health insurance also protects someone from suffering heavy financial losses in the event of a chronic illness or sudden, debilitating accident. Spending just two or three nights in a hospital can wipe out someone life savings or even cause them to file bankruptcy. Health insurance agents are always happy to answer any questions you might have.  They can also assist in finding the best kind of health insurance that is both appropriate and affordable.