Health Insurance

Health Insurance Types of Plans – Networks

There are many different types of health insurance plans. Almost every plan comes with a defined network of health care providers that your insurance company prefers. These plans will make you pay much more to purchase health services from a provider who is not included in the network. These out-of-network charges can be very large, and some health plans don’t cover out-of-network services at all.  When selecting a plan, it is very important to make sure that your regular doctors or other providers are included in the network. .

Monthly Premiums

When you buy health insurance you will need to pay premiums each month to keep your coverage. The premiums need to be paid monthly, before the month you want coverage, regardless of whether you use the insurance or not. In general, the higher the monthly premium for a plan, the lower the average cost-sharing.

Cost Sharing

When you buy healthcare services with insurance, the insurance company will pay a portion of the bill from your medical provider and you will be responsible for the rest of the bill. The amount of the bill that you pay is called “cost-sharing.” There are three main types of cost-sharing: co-payments, co-insurance, and deductibles.

A co-payment (also called a co-pay) is a set amount of money you pay for a healthcare service covered by the plan, such as $20 for a prescription.

Co-insurance is the percentage you pay of the total cost of a service covered by the plan, such as 20% of the cost of an office visit.

A deductible is another type of cost-sharing. It is an amount of money that you must spend on healthcare in a year before your health insurance company will begin helping you pay your bills for healthcare services. For example, if your plan has a $1,000 deductible, you will be responsible for 100% of the first $1,000 that you spend on health care every year (some services are exempt from the deductible). Once you have spent $1,000, the insurance company will begin paying your bills, except for your co-payments and co-insurance amounts.

Sometimes, your plan will have a deductible on certain services and not others.