Healthcare Insurance
Welcome to Health Insurance in TN – providing a general overview of health insurance – the most popular type of insurance. To start – health insurance is insurance against the possibility of incurring medical expenses among individual people. By estimating the overall risk of health care expenses among a targeted group, an insurer can develop a finance program. From this analysis, they can then determine a monthly premium or payroll tax to ensure that sufficient money is available to pay for the health care benefits specified in the insurance agreement. The benefit program is administered by a central organization such as a government agency, private business, or not-for-profit entity.
Health Insurance
Health insurance involves a written contract between an insurance provider (most often an insurance company or a government) and an individual or his sponsor (most often an employer or a community organization).
The contract can be renewable (annually or monthly) or may be lifelong in the case of private insurance. Health insurance may also be mandatory for all citizens in the case of some national plans. As stated above, the type and amount of health care costs that will be covered by the health insurance provider are specified in writing.
Health Insurance – basic terms
Premium: The amount the policy-holder or his sponsor (for example – employer) pays to the health plan to purchase health coverage.
Deductible: The amount that the insured must pay out-of-pocket before the health insurer pays its share. For example, policy-holders might have to pay a $500 deductible per year, before any of their health care is covered by the health insurer. It may take several doctor’s visits or prescription refills before the insured person reaches the deductible and the insurance company starts to pay for care.
Co-payment: The amount that the insured person must pay out of pocket before the health insurer pays for a particular visit or service. For example, an insured person might pay a $45 co-payment for a doctor’s visit, or to obtain a prescription. A co-payment must be paid each time a particular service is obtained.
Coinsurance: Instead of, or in addition to, paying a fixed amount up front (a co-payment), the co-insurance is a percentage of the total cost that the insured person may also pay. For example, the member might have to pay 20% of the cost of a surgery over and above a co-payment, while the insurance company pays the other 80%. If there is an upper limit on coinsurance, the policy-holder could end up owing very little, or a great deal, depending on the actual costs of the services they obtain.
Exclusions: Not all services are covered. The insured are generally expected to pay the full cost of non-covered services out of their own pockets.
Coverage limits: Some health insurance policies only pay for health care up to a certain dollar amount. The insured person may be expected to pay any charges in excess of the health plan’s maximum payment for a specific service. In addition, some insurance company schemes have annual or lifetime coverage maximums. In these cases, the health plan will stop payment when they reach the benefit maximum, and the policy-holder must pay all remaining costs.
Out-of-pocket maximums: Similar to coverage limits, except that in this case, the insured person’s payment obligation ends when they reach the out-of-pocket maximum, and health insurance pays all further covered costs. Out-of-pocket maximums can be limited to a specific benefit category (such as prescription drugs) or can apply to all coverage provided during a specific benefit year.
Capitation: An amount paid by an insurer to a health care provider, for which the provider agrees to treat all members of the insurer.
In-Network Provider: (U.S. term) A health care provider on a list of providers preselected by the insurer. The insurer will offer discounted coinsurance or co-payments, or additional benefits, to a plan member to see an in-network provider. Generally, providers in network are providers who have a contract with the insurer to accept rates further discounted from the “usual and customary” charges the insurer pays to out-of-network providers.
Prior Authorization: A certification or authorization that an insurer provides prior to medical service occurring. Obtaining an authorization means that the insurer is obligated to pay for the service, assuming it matches what was authorized. Many smaller, routine services do not require authorization.
Explanation of Benefits: A document that may be sent by an insurer to a patient explaining what was covered for a medical service, and how payment amount and patient responsibility amount were determined.
Prescription Plans
Prescription drug plans are a form of insurance offered through some health insurance plans. In the United States, the patient usually pays a co-payment and the prescription drug insurance part or all of the balance for drugs covered by the plan. Such plans are routinely part of national health insurance programs.
Some, if not most, health care providers in the United States will agree to bill the insurance company if patients are willing to sign an agreement that they will be responsible for the amount that the insurance company doesn’t pay. The insurance company pays out of network providers according to “reasonable and customary” charges, which may be less than the provider’s usual fee. The provider may also have a separate contract with the insurer to accept what amounts to a discounted rate or capitation to the provider’s standard charges. It generally costs the patient less to use an in-network provider.
The United States health care system relies heavily on private health insurance, which is the primary source of coverage for most Americans. Public programs provide the primary source of coverage for most senior citizens and for low-income children and families who meet certain eligibility requirements. The primary public programs are firstly Medicare, a federal social insurance program for seniors and certain disabled individuals. The second primary program is Medicaid, funded jointly by the federal government and states but administered at the state level, which covers certain very low income children and their families.
We hope that the information above was helpful as you look for Healthcare Insurance in TN.
