Life

TERM LIFE INSURANCE

The benefits of having health insurance can vary, but in general it offsets the cost of doctor bills, surgery, hospital, laboratory, x-ray, and pharmacy costs. In some insurance plans offered, it will cover specific long-term care, dental care, or vision care. Please see below for term definitions.

MANAGED┬áPLANS: provide the care at the lowest “out-of-pocket” expense. However, in order to keep the coverage affordable, there are rules that must be followed. There are two types of Managed Care plans:

1. Health Maintenance Organization (HMO)
Subscribers are designated a primary care provider to manage the course of their healthcare treatment. HMO patients are required to see in-network providers in approved facilities. There is no deductible for in-network services, and a small co-pay fee for in-network visits. Usually, no claim forms need to be filed, but access to care is directed by primary care provider.

2. Preferred Provider Organization (PPO)
This plan gives a patient more flexibility as they are able to see any in-network doctor, including specialists, without first getting approval from the primary care provider. Subscribers are able to seek out-of-network care, but insurance benefit is reduced and out-of-pocket expenses increase. Medium to high premium costs, reasonable co-pays, and out-of-network claim forms must be filed with a PPO plan.

INDEMNITY┬áPLANS: Often referred to as “fee for service” insurance, offers choices of healthcare providers, specialists and hospitals. Both insurance company and subscriber pay a fixed percent of medical costs, with a set maximum of “out-of-pocket expenses” that the subscriber will pay. Deductible fees are applied, and the patient is responsible for a percentage of medical costs, but are able to see any healthcare provider or facility they choose.

Term Definitions
Subscriber: the person who is insured
Premiums: the cost of the policy
Deductible: the amount you pay before your insurance starts to pay. Usually the higher your deductible, the lower the premium.
Co-pay: fixed amount the subscriber pays at the time of service
Co-insurance: percentage paid by subscriber for health care, after the deductible is met
In-network provider: healthcare provider or facility that has a contract with the insurance company, they provide services at a reduced cost
Out-of-network provider: healthcare provider or facility that does not have a contract with insurance company
Claim form: form to be submitted to insurance company to request payment of healthcare costs