Health Insurance Basics

Out of pocket expenses = Copay + Coinsurance + Deductible (Graphic)

Health insurance is a general term used to describe many kinds of insurance coverage that cover medical expenses as a result of sickness or injury. Comprehensive/Major Medical health insurance includes doctor visits, hospital care, tests, certain therapies and prescription drugs. However, limited benefit policies are also available that cover benefits for specified services or conditions.

Most Comprehensive/major medical policies require policyholders to satisfy annual out-of-pocket expenses such as:

  • Deductible- the amount you need to satisfy first before your insurance company will begin to cover the cost of your care. 
  • Co-insurance- an amount of money due, generally in the form of a fixed percentage a person must pay towards a claim after the deductible is satisfied. Health insurance policies may also have an out-of-pocket limit.  After the out of pocket limit is met, the insurance will then cover 100% of eligible claims.
  • Copay- a designated amount of money that is due to the provider when you obtain services.  This amount may vary depending on the type of provider you see.  

Usually, individual health insurance can be obtained during a specific period of time that occurs once a year and is referred to as Open Enrollment. During open enrollment, you can choose to pur­chase a new plan or decide to stay with your existing plan, provided it will continue to be offered by the insurance company. You can find the dates of the next open enrollment on the Federal Marketplace website at Healthcare.gov where you can compare options and buy insurance.

You may however apply for limited benefit policies at any time.