Health insurance is insurance against the risk of incurring medical expenses among individuals. By estimating the overall risk of health care and health system expenses, among a targeted group, an insurer can develop a routine finance structure, such as a monthly premium or payroll tax, to ensure that money is available to pay for the health care benefits specified in the insurance agreement. We offer health insurance information and offer fast, easy, seamless services that demand your attention.
The benefit is administered by a central organization. According to the Health Insurance Association of America, health insurance is defined as “coverage that provides for the payments of benefits as a result of sickness or injury. Includes insurance for losses from accident, medical expense, disability, or accidental death and dismemberment”.
Many health insurance shoppers don’t realize that there are many different types of health insurance. But it’s a good thing there are so many options because no one has the exact same health and budget needs as another.
There are two main kinds of individual health plans: managed care and traditional indemnity coverage:
- Managed care health insurance. This type of health insurance covers medical services from a specific network of doctors, hospitals and other health care providers. Common managed care plans include HMO (Health Maintenance Organization) plans, PPO (Preferred Provider Organization) plans and POS (Point of Service) health plans. With managed care plans, some policyholders can also open Health Savings Accounts (HSA) to save money tax-free for medical bills.
- Traditional indemnity coverage. Before managed care plans were created, traditional indemnity health insurance was the most common form of coverage. This type of health insurance covers medical care based on service rather than health care provider.
The main difference between these two forms of health insurance is that traditional indemnity plans provide the same coverage regardless of what doctor or hospital you visit, while managed care only covers care from particular health care professionals.