Health Insurance - Frequently Asked Questions
What is the basic difference between individual and group health insurance coverage?
An individual policy is purchased by you directly with the insurance company. With a group health insurance policy, the group is the master insured and the insurance company contracts with the group. Insurance certificates, issued to a participating member, act as your policy. Often group health insurance costs less than would have been charged had the insurance company sold individual policies to each member separately. In addition, group health insurance often contains special coverages that are not available or are very expensive on an individual basis. The purchasing power of the group makes this economically feasible.
What is the difference between a Health Insurance Agency and Health Insurance Carrier?
Insurance carriers, also called providers, offer policies and plans, determine parameters for setting premiums and benefits, and oversee the payment of benefits to customers enrolled in their plans. An agency is licensed and appointed by one or more carriers to sell these policies and plans directly to customers.
What are the various ways that individuals receive health insurance protection?
Besides participating in group insurance plans, individuals may also be covered under federal and state government-sponsored programs such as Medicare and Medicaid, service-type plans such as Blue Cross/Blue Shield or so-called alternative health care systems such as health maintenance organizations (HMOs) and preferred provider organizations (PPOs). Insurance may also be purchased privately on an individual basis, or through mass purchasing groups such as credit unions and professional or trade associations.
What types of individual health insurance policies are available?
There are a variety of policies which insurance companies offer on an individual basis. Some of the more common types of policies include:
1. Major Medical - provides coverage for doctor visits, surgery and hospitalization or ongoing illnesses.
2. Hospital and Surgery - provides coverage solely related to hospital stays and surgical services, such as room and board, laboratory tests, X-rays, plus doctors’ charges
3. Hospital Confinement Indemnity - a policy designed to pay a set amount (an indemnity) for each day you are an "in-patient" at a hospital.
4. Health Maintenance Organizations (HMOs) - centralized service provider, commonly with a general practitioner (limited selection of participating doctors) coupled with coverage by specialists upon referral. Doctor visits, surgery, hospitalization and often reduced-rate prescription medicine are provided. May also cover preventive care, often not included in major medical policies.
5. Specified Disease (also called “Dread Disease”) - covers costs associated with a single disease, such as cancer, AIDS, heart attack, etc.
6. Short-Term - typically a major medical policy but with coverage lasting only for a specified length of time. Might be purchased to cover the time you are between jobs.
7. Accident Only - provides coverage for doctor visits, surgery and hospitalization resulting from an accident (no coverage for disease or illness).
8. Dental - provides coverage for costs associated with dentists and orthodontists.
9. Vision - provides coverage for sight correction
10. Home-Health Care - care provided to enable you to remain in your home while receiving services which can range from assisted living (help around the house) to around-the clock nursing with other health care providers on call.
11. Long -Term Care - coverage provided to individuals who otherwise would not be able to take care of themselves. A range of services from delivery of prepared meals, assistance with managing the residence, to stays in residential facilities. Often associated with long-term illness and the elderly.
12. Limited - Benefit - not very common, a bare-bones type of coverage intended to cover specific situations.
What variables will affect my insurance premium?
Purchasers of insurance often can control several factors used to determine the insurance premium. Some of these factors, which act as limitations of the insurance coverage, include:
• Deductibles - The amount you yourself have to pay out-of-pocket before reimbursement of your expenses from the insurance coverage. It is usually a flat dollar amount. The higher the deductible, the lower the premium.
• Co-payments and co-insurance – for example, in a 80/20 plan, the insurance pays 80% of the covered expense and you pay out-of-pocket the remaining 20%. Most plans with a co-pay have a maximum, out-of-pocket, cost.
• Lifetime maximums - the maximum amount of insurance coverage that will be paid on your behalf during your lifetime
What is the basic difference between individual and group health insurance coverage?
An individual policy is purchased by you directly with the insurance company. With a group health insurance policy, the group is the master insured and the insurance company contracts with the group. Insurance certificates, issued to a participating member, act as your policy. Often group health insurance costs less than would have been charged had the insurance company sold individual policies to each member separately. In addition, group health insurance often contains special coverages that are not available or are very expensive on an individual basis. The purchasing power of the group makes this economically feasible.
What is the difference between a Health Insurance Agency and Health Insurance Carrier?
Insurance carriers, also called providers, offer policies and plans, determine parameters for setting premiums and benefits, and oversee the payment of benefits to customers enrolled in their plans. An agency is licensed and appointed by one or more carriers to sell these policies and plans directly to customers.
What are the various ways that individuals receive health insurance protection?
Besides participating in group insurance plans, individuals may also be covered under federal and state government-sponsored programs such as Medicare and Medicaid, service-type plans such as Blue Cross/Blue Shield or so-called alternative health care systems such as health maintenance organizations (HMOs) and preferred provider organizations (PPOs). Insurance may also be purchased privately on an individual basis, or through mass purchasing groups such as credit unions and professional or trade associations.
What types of individual health insurance policies are available?
There are a variety of policies which insurance companies offer on an individual basis. Some of the more common types of policies include:
1. Major Medical - provides coverage for doctor visits, surgery and hospitalization or ongoing illnesses.
2. Hospital and Surgery - provides coverage solely related to hospital stays and surgical services, such as room and board, laboratory tests, X-rays, plus doctors’ charges
3. Hospital Confinement Indemnity - a policy designed to pay a set amount (an indemnity) for each day you are an "in-patient" at a hospital.
4. Health Maintenance Organizations (HMOs) - centralized service provider, commonly with a general practitioner (limited selection of participating doctors) coupled with coverage by specialists upon referral. Doctor visits, surgery, hospitalization and often reduced-rate prescription medicine are provided. May also cover preventive care, often not included in major medical policies.
5. Specified Disease (also called “Dread Disease”) - covers costs associated with a single disease, such as cancer, AIDS, heart attack, etc.
6. Short-Term - typically a major medical policy but with coverage lasting only for a specified length of time. Might be purchased to cover the time you are between jobs.
7. Accident Only - provides coverage for doctor visits, surgery and hospitalization resulting from an accident (no coverage for disease or illness).
8. Dental - provides coverage for costs associated with dentists and orthodontists.
9. Vision - provides coverage for sight correction
10. Home-Health Care - care provided to enable you to remain in your home while receiving services which can range from assisted living (help around the house) to around-the clock nursing with other health care providers on call.
11. Long -Term Care - coverage provided to individuals who otherwise would not be able to take care of themselves. A range of services from delivery of prepared meals, assistance with managing the residence, to stays in residential facilities. Often associated with long-term illness and the elderly.
12. Limited - Benefit - not very common, a bare-bones type of coverage intended to cover specific situations.
What variables will affect my insurance premium?
Purchasers of insurance often can control several factors used to determine the insurance premium. Some of these factors, which act as limitations of the insurance coverage, include:
• Deductibles - The amount you yourself have to pay out-of-pocket before reimbursement of your expenses from the insurance coverage. It is usually a flat dollar amount. The higher the deductible, the lower the premium.
• Co-payments and co-insurance – for example, in a 80/20 plan, the insurance pays 80% of the covered expense and you pay out-of-pocket the remaining 20%. Most plans with a co-pay have a maximum, out-of-pocket, cost.
• Lifetime maximums - the maximum amount of insurance coverage that will be paid on your behalf during your lifetime