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Insurance Glossary Page
Network
A web of doctors and medical facilities that our contracted within the insurance companies network. The network ensurers lower rate to the consumer and the ability to use fixed copay for certain services.
Preferred Provider Organization or PPO
With a PPO you will receive a list of highly qualified medical providers and facilities to select for your health treatment. This type of coverage usually pays for hospital room and board, physicians and surgeons fees, lab services and more. The providers charge fees for service based structure. The charged rates are negotiated and are usually hit with discounts, based on network agreements between insurance company network and provider. PPO will cover you in and out of network. This type of coverage gives you freedom to go anywhere and anytime.
Health Maintenance Organization or HMO
This known and competitively-priced form of managed care gives you a restricted network of doctors and hospitals where you can receive treatment. HMO Plans have a gatekeeper which is the primary care doctor who dictates your treatment. The coverage available through the HMO ranges from routine physicals to emergency care to give you a comprehensive health insurance program.
Health Savings Account or HSA
A Health Savings Account is a new wave of health plans; it gives the consumer more control and different ways to pay for their health care expenses.. HSA's give you the ability to pay for your expenses and save while earning interest tax deferred amount to pay for future qualified medical expenses. This must be a high deductible plan, in most case with no co-pays which makes it more affordable with huge tax advantages.
You are in control of how much you contribute, where your money is invested and how you spend it. This is a no brainer type of plan for many people that look for peace of mind, low premiums and tax advantages.
Deductible
The deductible is the amount of money that the insured would pay before the insurance carrier starts paying. For example the hospital bill $23,000 and your deductible is $3000, the insurance would start paying on the remainder of $20,000. The good news is that, your deductible is once per calendar year, so if you meet it once you can enjoy insurance carrier to pay the rest of the bills. Most plans on the market provide copay's for office visits, preventive care, prescriptions and sometimes even urgent care visits. The copay's are usually not subject to the deductible.
Coinsurance
This is usually a percentage amount that is the insured's responsibility. Most popular split is 80/20, there is also 70/30, 50/50 and more. This means that the insurance company will pay the higher percentage most of the time and you pay the rest. Keep in mind that co-insurance usually kicks in after deductible, basically as a second deductible. Majority of the plans co-insurance levels have a cap on how much you responsible for, like $1000-$7000.
Co-payments
The co-payment is usually a small fixed amount you will pay for your doctors office visits, prescriptions or other services under copay’s. The great thing about copay is that you can enjoy the daily benefits of health care without having to meet the deductible.
Out-of-Pocket
In simple terms, this is the maximum you will out of you pocket for the calendar year. This is important to know when buying your health plan. You want to know what would be your total responsibility if your bill climbs to six figures.
Lifetime Maximum
The amount the insurance company is willing to spent on your health care expenses for the life of you policy. This usually ranges from $2 million to $8 million.
Exclusions
Conditions or things the insurance company won’t cover.
Pre-existing conditions
Any sort of condition, illness or disease one has before acquiring coverage. The are carriers that can approve or disapprove your coverage based on the pre-existing condition.
Waiting Period
Time it takes for a particular policy or it’s benefits to kick in. Waiting periods vary from 3 months up to a year depending on the policy benefit.
Grace Period
This is the time you have to pay their health insurance premium after the due date passed and before insurance coverage would be canceled.