Health Insurance 101

It can be scary to get sick, with the doctor's visits, medication and the feeling that you don't quite know exactly what is going on.

However, possibly more frightening than that is going through all that without the safety net of health insurance to lighten the amount of medical costs you will incur through inevitable treatment and care.

There are roughly 46 million people in the U.S. currently living with no health insurance, and while the government is working on a way to reform the healthcare industry, a new kind of healthcare plan may still be a couple of years away.

For the uninitiated, this may be a good time to get familiar with the basics of healthcare because aside from some its confusing aspects, it's more important to live with health insurance than live without it.

Do I even need healthcare insurance?

Without health insurance, a person or family may be forced to incur the full costs of their doctor's visits and hospitalizations, which can quickly accumulate to a small fortune. Also, it isn't enough to just get treatment when you are sick. Preventative care is another important element of healthcare and could save on costs in the future.

Getting regular checkups and physicals with a doctor within your healthcare network can ensure that you are keeping an eye on your body and maintain optimal health.

Finally, people who are under a health insurance plan will pay less for doctor's visits and hospitalizations when compared to people who are not enrolled in a plan. And given the current state of the economy, isn't the name of the game being fiscally responsible?

But how does this system work?

In a typical healthcare plan, which is called a fee-to-service plan, an enrollee pays a monthly premium (which is like a monthly subscription for a certain service) and when the patient has to visit a doctor or a hospital, the health insurance provider pays a portion of the bill.

The customer pays a lower portion of the bill for the healthcare service, called a co-pay. This may include routine medical visits, visits to the emergency room and dental checkups. Without health insurance, a routine physical can cost as much as $200. With coverage? $20. n
Which plan is for me?

Good question and it's one that only you can answer since there's a lot of different factors that go into choosing a healthcare plan.

One thing to keep in mind is a term called "pre-existing conditions." If you had a known illness or injury prior to you signing up for healthcare, it may affect your coverage. Some plans only consider a condition pre-existing if treatment was involved. Other plans may have a wider definition.

After that, it's important to determine what exactly you need from a healthcare plan. Older people may want coverage that includes surgeries and prescription medication while younger people may be more inclined to embrace a plan that's more about preventative care.

Another element to factor in is whether or not you have a certain doctor you are comfortable with or a family doctor who knows your medical history well. Some healthcare plans have specific networks that only allow you to visit certain doctors, while others allow you to see whoever you choose.

The co-pay may be a bit higher for the out-of-network physician, but if it's with someone you trust, it may be worth it.

Who has these plans?

Most people in the U.S. get their healthcare insurance through the company they work for, which most likely has a relationship with a certain healthcare insurance provider.

However, some people like to investigate the kind of coverage a different provider has or may want to have health insurance that isn't tied to their job, in case they leave that company or get laid off.

In that case, some people have employed a health insurance agent to help them determine which public healthcare plan might be best for them.

Staying with the same healthcare plan may also help people avoid experiencing gaps in coverage if they lose their job. Gaps in coverage can be a potentially dangerous situation because you will be solely responsible for any medical bills.