BeamaLife Blog

Throughout this past election year, health insurance has been the hot topic. Politico’s used terms like “HMO”, “PPO”, and “Premium” as if everyone understood what they meant. Fact is, there are people who are lost about health insurance from the start and unless you know what it is or how it works, and it is easy to become one of the roughly four-million uninsured citizens in this country.

Health insurance is what helps pay for medical bills and medications that most of us are finding increasingly difficult, if not at time impossible, to pay for out of pocket. These expensive costs are why it is being called on for reform, however, even if getting it becomes possible, how it works will likely remain the same. That is, you will be purchasing insurance either for yourself, as part of a group.

Individual insurance is bought by you, for you, through an insurance company or agent. Your application will be evaluated based on how much risk you present the company and your cost of premium payment will be determined accordingly if you are accepted. Your cost and range of coverage will depend upon your provider and type of policy, whether it is comprehensive—covers several types—or basic—covers mostly just physical, surgical, and hospital. It is also a good idea to add into your coverage major medical in case a catastrophic accident or illness occurs. Once you are given your cost for insurance, you will have to pay your premiums in full yourself.

Most people use a group insurance through their employer of civic groups like auto clubs. These are single policies that cover the medical expenses of the group regardless of age or physical condition. Unlike individual, you cannot mold it to fit your specific needs; however, it usually covers everything you might come across. Your payments will be based off of the group as a whole; i.e. average age, occupational hazard, etc. Whether your group is small or large, it is typically less expensive than individual coverage. Individual and group insurance is the broad brush of health insurance, once you’ve figured out how you are getting it, it is important to understand what you have. The common types of insurance are HMO, PPO, POS, and EPO.

Health management organizations (HMO) cover only expenses from treatments by a physician or facility within its network. You choose a primary physician who decides whether or not to refer you to a specialist and you will pay a fixed monthly fee with co-payments for your visits.

Preferred provider organizations (PPO) do not require members to seek care from PPO physicians and hospitals like HMO’s even though you pay the same way. Instead you will see less percentage of reimbursement.

Point of service (POS) combines HMO and PPO’s. You will have a primary physician for referrals, but you can go outside of the network in trade of being covered at a lower level.

Finally, there are the exclusive provider organizations (EPO) which are basically the same as the PPO except there is no coverage for out of network care.

Once you’ve gotten your coverage, and you understand basics of your type, it is wise to read and ask about your coverage so you don’t find yourself with an unexpected bill. Your policy should mention it’s coverage regarding pre-existing conditions and non-duplication benefits, as well as things that affect benefits like deductibles, coinsurance, co-payments, family coverage, out of pocket maximums, and a benefit ceiling. Questions and knowledge about these things will help to keep you from falling victim to paying for what you thought was covered.

Health insurance is becoming more and more a necessity as it becomes incessantly harder to get and keep. Finding the best way to get coverage and what type is right for you is most of the battle, and if you find trouble affording it yourself or getting it through your employer, check for civil organizations or pray for government reform. If those don’t pan out, then I suggest you watch your step.