It goes without saying that comparing health insurance online quotes can be very daunting. Besides the jargon, the policies and terms vary widely from one plan to another. To top that, the number of quotes available in the market just keeps increasing every day. To make the process of understanding and comparing these online quotes more manageable, refer to the following explanation of some of the terms you will come across.
Types of these Plans
When examining the quotes, the type of these plan may be a good place to start. Is an in-network or out-of-network plan better for you?
Indemnity Plan or Fee for Service Plan
- Traditional type of health insurance plan
- You do not need to get approval for medical care for the insurance company cover it.
- You may see any doctor you want to. There is no provider network; hence it is an out-of-network plan.
- You receive limited coverage for preventive or routine care.
- Expensive with high deductible as well as premiums.
Managed Care Plan
- Examples: PPS, POS or HMO
- Provider networks of doctors and medical centres are formed by the companies offering the managed care plan.
- On plans such as PPO, you receive less coverage if you do not go to an "in-network" provider.
- On plans such as HMO, you must go to an "in-network" provider to be covered.
- More affordable than indemnity plans.
Deductible, Coinsurance, Copayment and Out-of-Pocket Maximum
- This is what you'll have to pay for the medical bills before the insurance coverage begins.
- This is the percentage of the medical bills you have to pay. Usually the insurance covers 80% of the bill and you'll have to pay 20%. However, there is a pre-determined maximum amount that you'll be responsible for each year.
- This is the fixed dollar amount of the medical bills that you have to pay.
- This is the maximum amount you'll pay for a year inclusive of the deductible, copayment and coinsurance. If this amount has been reached, the insurance will take over 100% of the bills.
- They refer to your visit to the doctor or the dentist for routine care. If you do not make many office visits a year, you may consider dropping this cover to bring down your premium.
- You may also drop this cover if you are sure that you are not planning to have any babies. This will bring down the premium substantially.
- This refers to any treatment that does not require you to stay overnight. The coverage is usually low for this. Be a little careful with this as even serious costly treatments like chemotherapy may not require you to stay overnight. You'll bear the major burden of the cost with limited outpatient care coverage in such instances.
As of far, you have been exposed to some of the main terms that you will come across when looking up different quotes. Although the list is not exhaustive, hope these brief explanations of the terms have helped demystify these special online quotes.