What is Health Insurance?

Health insurance is a contract that requires the insurer to pay some or all of the person’s health care costs in order to receive payment. In particular, health insurance usually pays for medical treatment, surgery, medication, and sometimes dental costs incurred by the insurer. Health insurance can reimburse the insurer for expenses incurred due to illness or injury, or pay the care provider directly. It is usually included in the employer’s benefit pockets as a way to attract top employees, with premiums paid on the part of the employer but are also deducted from the employee’s contribution. The cost of health insurance premiums is deducted from the taxpayer, and the benefits received are tax-deductible, with the exception of S corporation employees. Health insurance companies charge their customers a monthly fee to pay, and in exchange the company agrees to pay all or most of the individual medical expenses. Even under the best of plans, insured people have to pay a variety of costs out of health care outlets. In particular these costs include copays and deductions, which are the main costs paid by insurers to medical professionals before they receive services. Health insurance schemes fall into two broad categories: private insurance and public insurance. Private plans are available from health insurance companies and are generally available to employers. Some of the top private insurance companies in the US include:

UnitedHealth Group
Humana
Anthem
Cigna
Blue Cross/Blue Shield
Wellpoint

In contrast, public insurance is provided by the state to eligible individuals and families. Medicaid is a government-run insurance scheme that is offered free of charge to low-income earners. Eligible and available installation varies from region to region. Medicare is available to all Americans over the age of 65 and people with a disability. Medicare covers only half of the cost of treatment, and people often need additional insertion to keep up with it. (“Bankrate.com – Compare mortgage, refinance, insurance, CD rates,” 2019)

How does health insurance work?

The health insurance policy covers the whole or a part of the hospital expenses. People often have questions regarding how insurance works. Take a look at the below pointers:

1. Choose the right coverage

If you are planning to buy health insurance, make sure you assess your needs. If you have dependent family members including your spouse and children, you can choose to get family float insurance or if you have foster parents over the age of 60, an Old Citizen program can be a good choice. The requirements vary from person to person, so choose the type of insurance wisely(“Bankrate.com – Compare mortgage, refinance, insurance, CD rates,” 2019)

2. Amount guaranteed

If the insurance company extends the insurance premium in the form of a guaranteed amount, the policyholder receives it in exchange for the premium you pay. Choose the best health insurance, which offers enough coverage at affordable prices.

3. Daily allowance

Another insurance cover gives you a daily allowance, where you get daily hospital cash to cover daily expenses for the number of days a person is hospitalized.

4. Application process

You can apply for health coverage in two ways – without refunds and refunds. The cashless process requires that you seek medical attention only at the insurance company’s network hospitals. Whether hospitalization is planned or unplanned, the insurance directly pays for the cost with the network hospital. However, in some cases where a cashless facility is not available, you may still be able to apply for health care through a rehabilitation program. Under this, you have to pay all the hospital bills, and later you need to transfer the debts to the insurance to get the refund transferred to your account directly.

5. Renewal and expiration of policy

The duration of health insurance depends on what type of plan you choose. Generally, the policies apply throughout the year. If you forget to renew, the policy will expire. If the policy expires, the insurance gives you a 6 month period in which you need to pay the remaining premiums and reimbursement costs.

6. No Claim Bonus

In the event that you do not apply for a particular year, you are entitled to not receive the application bonus. This can be in the form of a premium discount or an increase in the guaranteed amount.

Types of Health Insurance:

There are two main types of health insurance: private and public, or government. There are also a few other, more specific types. The following sections will look at each of these in more detail.

Public, or public health insurance

With this type of insurance, the state subsidizes health care to get payment. Medicare, Medicaid, Veterans Health Administration, and the Indian Health Service are examples of public health insurance in the U.S.

Private health insurance

The Centers for Disease Control and Prevention (CDC) says the US health system relies heavily on private health insurance. In a survey of National Health Interviews, researchers found that 63.7% of the most reliable Source for people under the age of 65 in the U.S. has a form of private health insurance.

Managed care programs

With this type of plan, the insurer will have contracts with a network of providers to provide low-cost medical care to policyholders. There will be additional penalties and costs added to offline hospitals and clinics, but they will provide some treatment. The more expensive the policy, the more flexible it is in a hospital network. (“Bankrate.com – Compare mortgage, refinance, insurance, CD rates,” 2019)

Point-of-Service Programs

The Point-of-Service system acts as a combination of the HMO system and the PPO system. Insurers can choose between coordinating all medical treatment by a primary care physician, receiving treatment within the network of insurance providers, and using non-network providers. The type of plan they have will mean continuous treatment. (“ICICI Prudential Life Insurance – Life Insurance Plans in India,” n.d.)

Preferred Supplier Organization Programs

The Association of Preferred Providers (PPO) system is similar to the payment system in that it allows an insured person to visit any doctor they prefer. The PPO program also has a network of accredited providers with whom you negotiate costs. Insurance will pay less for treatment with offline providers. However, people with a PPO system can refer you to a specialist without having to visit a primary care physician.

Indemnity, or Service Fee, plans

The Service Payment System includes equal treatment for all providers, allowing insurers to choose their preferred treatment option. The insurer will pay 80% of the cost in the reimbursement process, while the person will pay the remaining costs such as coinsurance.

Healthcare Organization Programs

These are organizations that provide direct medical care to insurers. The policy will usually have a dedicated primary care physician who will coordinate all necessary care. Health Maintenance Organization (HMO) programs will usually only fund treatment referred by a family doctor and will have to pay for each medical service to reduce costs. This is usually the cheapest type of program.

How can you choose the right health insurance plan?

Anyone with health insurance will tell you that buying it is one of the smartest financial decisions of any leading person. Now that you have decided to buy health insurance, you need to know how to choose the right health insurance plan that will take care of all your needs. Here is a list of the benefits that any good health insurance program should offer you:

Protection against a large number of serious diseases
Flexibility to choose your health cover
There is no increase in premiums during the policy even if your health status changes
Long term coverage even in your old age
Large hospital network for easy access to treatment

Results of health insurance

The most notable features of the modern health insurance system are:

1. Consolidation

Insurance plans provide complete protection against all potential costs during any health-related emergency. Includes hospitalization costs, hospitalization costs, ambulance costs all under one policy. Serious illnesses such as cancer, kidney failure, and stroke are also covered by the health insurance system.

2. Renewal of discounts

Non-Payment Bonus is payable to an insured person the following year if no claim has been made against the policy in the previous year. This bonus can be in the form of a high premium discount or a guaranteed amount can be increased. Some insurance brokers also offer a free trial if there is a good record of no bonus payments.

3. Co-payment

Co-payment is an option offered by many insurance brokers that helps reduce the annual premium. A percentage of the total cost is paid by the insured person while the insurance company pays the balance.

4. Tax benefits

Among the lesser-known health insurance benefits, is that under section 80D of the Income Tax Act, 1961, health insurance policies give you the right to receive tax benefits. The premium paid for health insurance is tax deductible, both by your policy or by your family members.

5. Adaptability

The insurance system offers high flexibility for the insured. Insurance buyers can reduce their premium over time or change their policy duration completely. Health insurance providers are also committed to adjusting the terms of your insurance plan in line with changes in your lifestyle, such as changes in your marital status. (“ICICI Prudential Life Insurance – Life Insurance Plans in India,” n.d.)

What Are the Benefits of a Health Insurance System?

1. The cost of a road ambulance

General health insurance covers any ambulance costs incurred during medical emergencies. This brings huge profits as leading hospitals tend to charge higher shipping costs. (investopedia, 2019)

2. Home Care

Compensation for all hospital bills is covered by the entire health insurance policy. This includes medications, nurse fees, injections etc. paid for the full treatment of the patient.

3. Daily Hospital Money Cover

The daily cash allowance is provided by designated institutions, which allow people to pay for lost pay during hospital stays.

4. The cost of hospitalization before and after

Pre-hospital expenses such as diagnostic expenses, doctor’s fees, etc. can be repaired with a health insurance plan. Post-discharge costs such as medications, routine tests, injections, etc. they are also reimbursed by many insurance companies. Compensation funds in the same comparison can be issued as a lump sum sum, or by generating appropriate liabilities.

5. No Cap on ICU Room Charges

Health insurance policies also include ICU bed fees. An insured person may also choose to live in a private room, the cost of which may be borne by the relevant insurance provider, up to a specified amount or total insured amount, at the discretion of the insurance company.

6. Cost of organ donation

Claims can be made for all medical bills that accumulate in organ donation. All major insurance companies adhere to the above-mentioned provisions in their insurance products. However, different types of insurance policies are offered to cover certain diseases, or to provide for different age groups.

7. Re-Fill the Guaranteed Amount7. Re-Fill the Guaranteed Amount

Under such health insurance, you can make claims up to a number of insured twice a year, as long as the health conditions are different each time.

8. No Claim Bonus

For each non-filing year, insured people are given extended discounts or maximum insurance premiums (at no additional cost) in subsequent years, which may help to reduce their annual premium fees or extend their total insurance coverage.

9. Child care procedures

Costs incurred in treating children in hospitals such as dialysis, cataract, tonsillectomy, etc. they are included under many health insurance schemes.

10. Cost of Bariatric Surgery

Only certain insurance providers agree to bear all the costs incurred in surgery aimed at helping people overcome their obesity problems. Obesity often leads to other related problems such as heart problems, diabetes, high blood pressure, and so on. This improves people’s well-being over time.

Such features of comprehensive health insurance are able to meet all the major medical costs a person may have to incur. At slightly higher premium costs, additional benefits in the form of a higher protection center are provided to larger institutions. (investopedia, 2019)

11. 0% Co-payment

Well-known insurance companies cover all medical bills generated during the insured’s treatment, up to the insured amount. Zero co-payment reduces a patient’s financial liability, allowing us to focus only on recovery.

12. No Rental Room In The Room

The hospital room rental is covered under that health insurance, which allows insured people to recover more comfortably. The amount deducted in such cases is determined by the insurance company in advance.

13. Mental Illness Cover

Timely hospitalization for psychiatric treatment is also included in the terms of health insurance. With the increasing levels of mental health problems in India and around the world, the center allows people to seek professional help to stay healthy.

14. The cost of hospitalization

Any medical condition that requires emergency hospitalization is covered under general health insurance schemes. However, applications are only enjoyed, as long as the disease has not been diagnosed previously while the insurance system is not available.

The cost of hospitalization incurred under the following circumstances is also increased by reputable insurance providers:

Serious Disease Treatment – Some insurance providers extend the amount in excess or more than the amount covered by insurance to cover all existing costs of treating critical illnesses. All medical expenses including hospitalization, diagnosis and medication, etc. they are paid by many companies.
Accident and Illness Receivables – Medical expenses incurred during hospitalization due to illness or accidental injury are also subject to these costs. Total medical expenses up to or more than the guaranteed amount are provided by major insurance providers. Such extensive installation helps you to stay financially secure in the event of unforeseen circumstances.

15. Area development area

Considering the rising medical costs in major cities, you can opt for a local development cover to cover all the medical needs of the best hospitals available there. If you are from Zone B or Zone C cities, you can get coverage for health insurance coverage from certain insurance providers such as Digit, which allows you to get quality treatment in Zone A cities without additional financial burden.