Truth behind Health Insurance

Could you explain what a health insurance premium is? What about coinsurance?

Just under half of Americans with health insurance feel confident that they understand such basic insurance terms, according to a recent study in the journal Health Affairs. Among uninsured Americans, fewer than a quarter have that confidence.
As the Affordable Care Act creates millions of new health insurance customers and provides new options for the already-insured, confusion about basic insurance concepts could make it difficult for people to make the right choices.
"The vast majority of consumers do not know the ins and outs of health insurance because they never have needed to," says Eric Stauffer, a former insurance agent who now rates and reviews insurance companies online.
"For years, most people have received health insurance through their employers. They get a card in the mail, and that is their ticket to health insurance," he says. "Consumers rarely saw much more than a bill for a few hundred dollars here and there."
But it's no longer so simple. "Years of being naive about the entire industry are starting to catch up with people now," Stauffer says.
Here are five things a wise health insurance consumer needs to know.

Read more: Make more than $10000 in a week using the foreign exchange

Read More: Earn more than $3000 from Facebook in just 2 days

Every health insurance plan includes a number of variables, so just looking at the monthly payment, or premium, doesn't tell the whole story.
To determine whether a plan fits your situation, you must understand the big picture. That includes the annual deductible, which is the amount a consumer must pay out of pocket before the insurance company will pay any expenses.
"If you are a healthy person, there is no reason to have a deductible lower than $5,000," says Ashley Hunter, president of HM Risk Group, a niche insurance brokerage serving the U.S. and the Middle East.
"Purchase a policy with a higher deductible and an option that allows you to have at least two doctor visits with a copayment for emergencies," she says, adding that you might then invest your premium savings.
People who seek health care regularly should look for a low copayment, which is a fixed out-of-pocket charge for medical services.
"We find that if you tend to use your health insurance, it is almost always cheaper to take a higher-cost plan with the lowest out-of-pocket expenses," says John Seltzer, founder and CEO of J. Seltzer Associates, a Pittsburgh-based insurance brokerage specializing in employee benefits.

Read more: Earn more than $1000 in a day. Make money online as a translator.

Read More: earn money online without investment 

 

While copayments and coinsurance are both types of cost-sharing between the consumer and the insurance company, they are two distinct types of payments, notes Michelle Katz, a nurse and the author of "Healthcare for Less" and "101 Health Insurance Tips."
In a copayment, also known as copay, the patient pays a specific flat dollar amount to the provider, usually for each service or treatment, such as $25 for a checkup.
Coinsurance, on the other hand, is a percentage of costs that a patient must pay after the deductible is met. "For example, you may have a deductible of $250 before insurance will cover 80 percent of charges, leaving you responsible for the other 20 percent -- known as coinsurance," Katz explains.