Overland ParkBlog
March 5, 2024
Health Insurance Basics: Understanding Coverage & Costs
Health insurance works by providing financial coverage for medical expenses incurred by the insured individual. When someone purchases health insurance, they pay a premium, usually every month, to the insurance company. In return, the insurance company agrees to cover a portion of the insured individual’s medical expenses, depending on the terms of the policy.
Some common terms associated with health insurance that may not be well understood include:
1. Premium: The amount paid by the insured individual to the insurance company for coverage.
2. Deductible: The amount that the insured individual must pay out of pocket for covered services before the insurance company starts to pay.
3. Copayment (or Copay): A fixed amount that the insured individual pays for covered services at the time of receiving care.
4. Coinsurance: The percentage of the cost of covered services that the insured individual is responsible for paying after the deductible has been met.
5. Out-of-pocket maximum: The maximum amount that the insured individual is required to pay for covered services during a policy period, after which the insurance company covers 100% of the costs.
6. Network: The group of healthcare providers, hospitals, and facilities that have contracted with the insurance company to provide services at a discounted rate to insured individuals.
7. Preauthorization: The process of obtaining approval from the insurance company before receiving certain types of medical care or services.
8. Exclusion: Specific medical services or treatments that are not covered by the insurance policy.
9. In-network vs. out-of-network: In-network providers are those who have contracted with the insurance company to provide services at a discounted rate, while out-of-network providers do not have such agreements and may result in higher out-of-pocket costs for the insured individual.
10. Explanation of Benefits (EOB): A statement sent by the insurance company to the insured individual explaining how a claim was processed and detailing the costs and payments made.
For the visual learners among us, here is a short YouTube series that explains health insurance in a very concise manner.
We are always available to walk through any insurance, or cash-pay, questions you might have when it comes to services here at TruMove in Overland Park.
And for the podcast lovers among us…you can find the Cure and the Curse podcast on Facebook.
