Health Insurance Coverage Questions

Health insurance policies pay specific sums of money in benefits for specific health services and treatment, according to the Entrepreneur website health insurance definition. Health insurance policies are contractual agreements between the health insurance provider and the insured policyholder. The policyholder pays premium costs in exchange for the guaranteed payment of the aforementioned benefits. You should ask a potential insurance provider questions to better understand policy terms and conditions.

What are out-of-pocket costs?

• Health insurance policies include private purchase plans, employee group policies and government-sponsored programs. Most policies include some types of out-of-pocket expense. Amy Buttell states in her Bankrate article "Paying out-of-pocket health care costs" that "The U.S. government predicts that consumer out-of-pocket health care expenses will reach an average of $3,301 a year for each household by 2014 from $2,500 in 2009." Buttell points out that these costs are on top of individual premium portions on group health plans. Expense you typically pay can include co-payments and co-insurances, which are your portion of office visits and services. You usually have a deductible, as well, that must be met before your benefit payments kick in.

What is a PPO?

• In the Health Insurance website's "Frequently-asked questions about health insurance" overview, "What is a PPO?" is noted as a common question asked by people considering opportunities available through group health plans. A PPO, or preferred provider organization, is a common employee group health insurance setup that effectively establishes a three-way agreement of care between the insurer, policyholder and healthcare provider network. Healthcare providers agree to provide care at contracted service rates, according to the Health Insurance site, in exchange for participation in the network of providers promoted to members. Insurers save on claim costs by encouraging the insured members to use in-network providers. Insured members get access to broader healthcare benefits in exchange for using network providers.

How much does it cost for coverage?

• The key to getting good value in any purchase is understanding the relationship between what you get and what you pay. In health insurance, this value hinges on getting adequate healthcare benefits protection for you and your family at a reasonable cost. This value is of extra importance to small business owners and self-employed people, according to the Entrepreneur site. You need access to benefits to cover emergency care and more common health issues. After that, can you afford to pay more for other types of maintenance and treatment healthcare services?

  It is costly for an individual to purchase private health insurance as you have to cover the full premium yourself. As part of an employee group, your employer may cover some or all of your premium. Factors that affect costs for private protection relate to your health risks including age, gender, health behaviors, and pre-existing conditions. Group insurance providers look at the entire group to determine costs for members within the covered group.