A Health insurance is a type of insurance which pays for medical costs or expenses. It is at times used to embrace insurance that covers long-term nursing, disability or custodial care necessities. Health insurance may be offered via a government-sponsored social insurance program or through private insurance companies. A health insurance may be obtained on a group basis or by individual consumers.
Health insurance functions by calculating the inclusive consequences of healthcare expenses and mounting a custom finance structure which will make sure that money is obtainable to pay for the benefits mentioned in the insurance agreement. The healthcare benefits are governed by an organization that is most often a government agency or not-for-profit entity or private entity that is operating a health plan.
The agreement between an individual and a health insurance company is called a health insurance policy. The agreement or contract can be renewable monthly or yearly. The amount and form of health care costs which will be covered by the health plan are identified in advance, in the Evidence of Coverage booklet or in the contract signed by the member. The payment obligations of an individual policy-holder may take various structures like the following:
Copayment
A copayment is the amount that is being paid by the policy-holder before the health plan pays for a specific service or specific visits.
Premium
A premium is the amount that is being paid each month by the policy-holder to the health plan to acquire health coverage.
Deductible
A deductible is the amount that is being paid by the policy-holder before the health plan pays its share.
Exclusions
The term exclusions refer to all services that are not covered by the health plan The entire cost of the services which are not covered by the health plan must be paid by the policy-holder.
Coverage Limit
Some health plans only pay for health care to a limited amount. Any bills in excess of the health plan's utmost payment of a particular service are expected to be paid by the policy holder.
Out-of-pocket maximums
Out-of-pocket maximums are almost the same with the coverage limits. The difference is that it can be limited to a particular benefit group including prescription drugs or can apply to all health plan coverage provided during a given benefit year.
Capitation
A capitation is the amount that is being paid by an insurer to a health care provider, for which the provider agrees to treat all members of the insurer.
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