We work hard to give our families a better life. We treasure our families and assets so much. Therefore, protecting them is the best thing that we can do. What better way to protect our family and the assets that we have worked so hard for than getting a health insurance policy?
A health insurance policy is a contract between an insurance provider and an individual or sponsor, such as an employer. The contract can be renewed, or last for a lifetime if private insurance. The type and amount of healthcare costs covered by a health insurance provider are specified in writing in a contract or a coverage booklet.
Here are some of the obligations that you may have for the health insurance:
The premium is a specific amount that you, as the policy holder will have to pay to purchase the health insurance. In the case of the individual-sponsor type of plan, the premium may be paid by the sponsor.
It doesn’t mean that once you have a health insurance, all of the health care specified in your contract will be paid by the healthcare provider. There are still deductibles. You will be responsible in paying for the deductibles before the health insurer will begin paying its share. For instance, you might need to pay for a $300 deductible annually. It might take several visits to the doctor before the insurance company begins to pay for your health care. More often, many health insurance providers will not allow a co-payment for medical check-ups against your deductible.
The copayment is also a certain amount that you need to be responsible of before your insurer pays for a certain medical check-up fully. Don’t confuse this with the deductible. The copayment is a shared payment between you and the insurance provider. For example, if the medical check-up costs $100, you have to pay half of it.
This still depends on the health insurance coverage that you got. With co-insurance, you have to pay a certain percentage of the total cost that needs to be paid. For example, you have been hospitalized. You might be required to pay 30% of the total hospital bill while the health insurance will pay for the remaining 70% of the hospital bill. Usually, the amount to be paid by the health insurance is higher than what you need to pay if you get a private health insurance.
There are certain medical procedures and services that will not be included by the health insurance. In this case, you will be required to pay the full amount of the medical procedure or treatment.
This means that there is a certain limitation to the amount that will be paidby the health insurance policy, The excess of the dollar limits should beshouldered by you. For instance, you are hospitalized, there is a dollar limit of $10,000 and the hospital bill is $15,000. You will have to shoulder the remaining $5,000 because of the $10,000 health limit. There are some insurance companies that have an annual or a lifetime coverage limit. After the coverage limits have been consumed, then the health insurance you gotwill be halted.
This is oftentimes confused with coverage limits because of the striking similarities that they have. The only thing that is different between the out-of-pocket maximum and the coverage limits is that your payment obligations will end once you have reached the out-of-pocket maximum, and the health insurance will have to pay the exceeding medical bills.