For quite some time now, the American Healthcare System has been this weird public-private sector hybrid. The Affordable Care Act (ACA), more commonly known as Obamacare, enacted an individual mandate: all people must be covered by some sort of health insurance, barring some exceptions based on religion or socioeconomic background. However, there are many sources of health insurance coverage from which people could theoretically choose, which is where the public vs. private hybrid mess begins...
PRIVATE vs. PUBLIC
Most people who are covered by private insurance companies (including BlueCross BlueShield, United, Aetna, Cigna, etc.) receive their plans from employers. Typically, costs for the insurance premium, or what is owed each month to the insurance company to, you know, stay insured, is deducted from the employee's paycheck. Usually, works will get some choice of which insurance plan works best for their lifestyle. However, receiving health insurance through an employers requires working full-time at a large enough business that they do provide benefits to their workers.
For those of us unlucky enough to not receive health insurance from employers, we must navigate the public sector. Typically, when people hear this statement, they automatically think about Medicare or Medicaid. The ACA also made sure that each state offered at least one public health insurance plan. Typically, there is less flexibility among this plan, and the insured are forced to pay high premiums for little to no coverage.
UNDERSTANDING YOUR PLAN
Alright, so you've managed to somehow acquire a health insurance plan. Either you're 26 and still insured under your parents, have a stable job, or wove your way through the maze of publicly offered health insurance. You've picked a plan, maybe randomly, maybe not. So, you've probably been inundated with tons of terms like "copay" or "deductible". Let's quickly break down what these mean:
Copay: A set amount (set by your insurance plan that is) that you pay for a certain medical service. These services can include an office well-visit or physical therapy appointment. Copays will typically differ based off of the medical service.
Coinsurance: aka the bad version of a Copay. Coinsurance is a set percentage that you pay based off of what the provider has contracted out with the insurance company for that service. Coinsurance unfortunately does not apply until you have met your deductible, so you'll be basically paying out of pocket rates until that threshold has been met.
Deductible: An out-of-pocket threshold. Once met, coinsurance kicks in along with other benefits form your plan, possibly. Depending on your plan, deductibles can be as high as $20,000 and as low as $500 annually. There are individual and family deductibles built into each plan. If an individual's deductible is met, benefits only kick in for that individual. However, if the family deductible is met, benefits kick in for all members of the insurance plan, regardless of the progress on their individual deductibles. The good news is that individual deductibles typically contribute to the overarching family deductible.
Out-of-Pocket Maximum: Basically, this is the max amount of money you can spend out of pocket on medical services. After you hit this threshold, your insurance will cover 100% of your bills.
PPO vs HMO: If you have a PPO plan, you're in luck. PPO stands for "Preferred Provider Organization", and it lets you choose whatever provider you please, so long as they are contracted with your insurance company. HMO gives you a set list of providers under which you would be covered. Otherwise, you'll be paying cash for all of your medical visits.
So we've broken down insurance plans to their bare bones. But why do people complain about the healthcare system in America so much and why is there so much disagreement on what type of healthcare system we should even have?
PRIVATE vs. PUBLIC
Most people who are covered by private insurance companies (including BlueCross BlueShield, United, Aetna, Cigna, etc.) receive their plans from employers. Typically, costs for the insurance premium, or what is owed each month to the insurance company to, you know, stay insured, is deducted from the employee's paycheck. Usually, works will get some choice of which insurance plan works best for their lifestyle. However, receiving health insurance through an employers requires working full-time at a large enough business that they do provide benefits to their workers.
For those of us unlucky enough to not receive health insurance from employers, we must navigate the public sector. Typically, when people hear this statement, they automatically think about Medicare or Medicaid. The ACA also made sure that each state offered at least one public health insurance plan. Typically, there is less flexibility among this plan, and the insured are forced to pay high premiums for little to no coverage.
UNDERSTANDING YOUR PLAN
Alright, so you've managed to somehow acquire a health insurance plan. Either you're 26 and still insured under your parents, have a stable job, or wove your way through the maze of publicly offered health insurance. You've picked a plan, maybe randomly, maybe not. So, you've probably been inundated with tons of terms like "copay" or "deductible". Let's quickly break down what these mean:
Copay: A set amount (set by your insurance plan that is) that you pay for a certain medical service. These services can include an office well-visit or physical therapy appointment. Copays will typically differ based off of the medical service.
Coinsurance: aka the bad version of a Copay. Coinsurance is a set percentage that you pay based off of what the provider has contracted out with the insurance company for that service. Coinsurance unfortunately does not apply until you have met your deductible, so you'll be basically paying out of pocket rates until that threshold has been met.
Deductible: An out-of-pocket threshold. Once met, coinsurance kicks in along with other benefits form your plan, possibly. Depending on your plan, deductibles can be as high as $20,000 and as low as $500 annually. There are individual and family deductibles built into each plan. If an individual's deductible is met, benefits only kick in for that individual. However, if the family deductible is met, benefits kick in for all members of the insurance plan, regardless of the progress on their individual deductibles. The good news is that individual deductibles typically contribute to the overarching family deductible.
Out-of-Pocket Maximum: Basically, this is the max amount of money you can spend out of pocket on medical services. After you hit this threshold, your insurance will cover 100% of your bills.
PPO vs HMO: If you have a PPO plan, you're in luck. PPO stands for "Preferred Provider Organization", and it lets you choose whatever provider you please, so long as they are contracted with your insurance company. HMO gives you a set list of providers under which you would be covered. Otherwise, you'll be paying cash for all of your medical visits.
So we've broken down insurance plans to their bare bones. But why do people complain about the healthcare system in America so much and why is there so much disagreement on what type of healthcare system we should even have?
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