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Health Insurance Guide
Exactly What Is Health Insurance?
Do I really need health insurance or can I live without it?
This is a question which many people ask and it is not always an easy question answer. Indeed, the answer often depends on who you ask.
As with most form of insurance, it could be argued that you don’t really need it until you need it. For example, car insurance doesn't do you any good until you have a car accident and life insurance doesn't do you any good until you are dead. By the same token, health insurance doesn't do you any good until you a sick. However, if like many people you believe in Murphy's Law - that whatever can go wrong, will go wrong - then it would probably be a good idea to think about getting health insurance.
In many countries such as the United Kingdom, Canada, France, Norway and Sweden health insurance is not an issue since medical care is provided free of charge and doctors and hospitals are reimbursed by the government.
In the United States however most healthcare bills are met from insurance and there are three basic forms of health insurance:
- Self-Insured or Uninsured. Here an individual either has no insurance at all or has health insurance and is responsible for paying his own insurance premiums. It is estimated that at least 30% of the United States population falls into this category.
- Managed Care Plans. Managed care plans, which are networks providing contracted service by specified providers at contracted prices, fall into three categories:
- Health Maintenance Organizations (HMOs) are pre-paid health insurance plans for which members pay a set monthly premium. HMOs provide medical services ranging from visits to the doctor's office to hospitalization and surgery and you are normally required to seek treatment from a designated network of healthcare providers.
- Preferred Provider Organizations (PPOs) comprise groups of doctors and healthcare facilities which provide medical services to a specified group. Members of PPOs normally pay for services as they are used and are then reimbursed for the costs of treatment. In most cases services are provided at a price which has been negotiated between the healthcare provider and the PPO.
- Point Of Service (POS) is a type of managed healthcare system in which you pay a minimal co-payment and no deductible as long as health care is provided within your network. However, you are free to seek treatment outside of the network but, should you wish to do so, you will have to pay additional charges and possibly a deductible.
- Indemnity Plans. An indemnity health insurance plan allows the plan holder to seek medical treatment whenever and wherever they choose. The major benefit of an indemnity plan lies in the freedom of choice that it gives to plan holder but this freedom also makes indemnity plans the most expensive form of health insurance.
The form of plan that will best suit your needs will depend very much on your personal circumstances and choosing a health insurance plan is a time-consuming task. Nonetheless, health insurance is something which everyone needs to consider sooner or later.
Beneficence: An ethical principle which, when applied to managed care, states that each member should be treated in a manner that respects his or her own goals and values and that managed care organizations and their providers have a duty to promote the good of the members as a group.
Experience rating: A rating method under which an MCO analyzes a group's recorded healthcare costs by type and calculates the group's premium partly or completely according to the group's experience.
Mail-order pharmacy programs: Programs that offer drugs ordered and delivered through the mail to plan members at a reduced cost.
Recredentialing: Reexamination by an MCO of the qualifications of a provider and verification that the provider still meets the standards for participation in the network.
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