How health insurance works

Let’s suppose you wake up one morning feeling a little under the weather.You decide to see a doctor and go to your neighbourhood clinic. The doctor examines you, prescribes necessary medicine, and suggests specific tests. You leave the clinic feeling relieved knowing that your health is well taken care of. However, have you ever questioned how you pay for such premium healthcare? That’s where health insurance comes in, like a guardian angel overseeing your well-being.

Having said that, understanding the key terms and concepts in the large and convoluted world of healthcare is critical for navigating the maze of plans and coverage. This blog will examine all you need to know about healthcare insurance. So, let’s get started!

What is health insurance?

Health insurance acts as a safety net, saving you from unforeseeable medical care fees. It is a contract between you and an insurance provider that helps pay the price of healthcare benefits such as doctor visits, hospital stays, prescription medications, and medical treatments. You get access to a comprehensive range of healthcare benefits by paying a regular premium, ensuring that you can afford the treatment you require when you need it the most.

Top 11 terms and concepts

With its plethora of jargons and concepts, navigating the world of healthcare insurance may be daunting.

On the other hand, understanding these fundamental features is critical for making educated selections regarding your healthcare coverage.

Here are 11 concepts and terms related to best health insurance policy that you should be aware of:

1. Premium: The amount customer pays annually to the insurance company to avail the benefits of your health coverage. This premium can be converted into easy monthly instalments as well.

2. Deductible: The amount customer agrees to pay out of his pocket in case of a claim. Customers opt for deductibles to reduce the premium they need to pay upfront to get coverage

3. Co-payment: Insurance companies offer a co-payment facility to make it more affordable for customers to buy health insurance. Co-pay is an arrangement whereby customers agrees to pay a percentage of medical expenses out of pocket while the remaining is paid by the insurer.

4. In-network: In-network providers are healthcare experts and facilities with which your insurance company has a contract. Customers can avail cashless claim services in these hospitals

5. Out-of-network: Healthcare practitioners and skills without an agreement with your insurance company are considered out-of-network. If customer takes treatment in such facilities, then he has to opt for reimbursement claim.

6. Pre-Authorisation: Prior authorisation is another name for preauthorisation, which refers to getting your insurance provider’s approval before going for a particular medical procedure or treatment. This is also called cashless approval.

7. Pre-Existing Condition: An illness or disease you had before buying a health plan.

8. HSA (Health Savings Account): A tax-advantaged savings account, also known as an HSA, enables you to set aside money before taxes to cover certain medical expenses.

9. Preferred Provider Organisation (PPO): A PPO is a type of insurance plan that offers more flexibility in choosing healthcare providers. You have the option to consult in-network and out-of-network providers, although out-of-network treatment may be more expensive.

10. Exclusive Provider Organisation (EPO): An EPO hybridises Health Maintenance Organisation (HMO) and PPO plans. Like an HMO, you generally need a Primary Care Physician (PCP) and referrals, but you may have some coverage for out-of-network care in emergencies.

11. Explanation of Benefits (EOB): An EOB is a document from your insurance company that describes a healthcare claim, including the services delivered, the amount invoiced, and the part covered by your insurer.

How healthcare insurance works

Healthcare insurance works by giving financial security as well as access to healthcare services when they are required. When you sign up for healthcare insurance, you must pay a premium to the insurance company. In exchange, depending on the conditions of your plan, the insurance company agrees to pay for some or all of your healthcare expenditures.

You usually see a doctor or healthcare provider in your insurance plan’s network when you require healthcare services.

Specific treatments may be subject to a deductible, co-pay, or coinsurance under your insurance plan, while others may be covered entirely. Your plan’s out-of-pocket maximum usually caps the amount you pay for covered treatments.

When you accept a medical bill, your insurance company is generally the first to be billed. They will then pay half the bill, leaving you to settle any excess amount.

Conclusion

Healthcare insurance is essential for safeguarding your health and giving financial protection against medical bills. You can manage the complexity of health insurance more confidently if you grasp basic concepts like premiums, deductibles, copayments, and networks.

Feel free to contact insurance providers like NivaBupa, the best health insurance company in India, who can offer helpful advice and assistance in locating the best healthcare insurance plan for you.

Contact NivaBupa now to give yourself the information and coverage you need to prioritise your health and enjoy life.