What Is Health Insurance?
Health insurance is a plan most people purchase to help protect themselves from the high cost of healthcare.
Having health insurance keeps you from paying for all of the costs when you are sick or have an accident—because your plan helps pay for some of your medical costs/expenses. This is referred to as cost sharing.
The services the plan covers, and the dollar amount the plan pays, are your coverage. Coverage varies by plan. To find out what your health plan covers, be sure to check the contract.
What Services Are Typically Covered by Health Insurance?
| Most plans DO COVER | Most plans DO NOT COVER |
|---|---|
Most doctor visits and hospital stays 
Emergency services 
Prescription drugs 
Lab services 
Preventive and wellness care 
Chronic disease management 
Mental and substance use disorder services, including behavioral health treatment 
Rehabilitative and habilitative services, including some medical devices 
Pregnancy, maternity and newborn care |
|
Other Factors To Consider When Choosing a Plan
Coverage isn't the only thing to keep in mind when selecting a health plan that’s right for you. Other factors include:
- Copayments (or copay)—a fixed dollar amount you pay when you visit a doctor or other provider for service.
- Deductibles—the amount you must pay before your insurance plan begins to pay its portion.
- Coinsurance—the percentage of the cost you pay after you meet your deductible.
- Premiums—the money you pay each month for your health insurance plan. Typically, the higher your premium, the lower your cost share, which includes copays, deductibles and coinsurance—and vice versa.
Monthly Premium
=
Cost Share
Monthly Premium
=
Cost Share
- Out-of-pocket maximum—the most you'll have to pay for medical and prescription drugs in a calendar year. If you reach your in-network out-of-pocket maximum, the plan will pay 100% of your covered medical expenses for the remainder of the year.
- Cost of going to out-of-network providers—to keep costs to a minimum, you'll want to know if a provider is in or out of network. Some health plans, such as an HMO plan, only cover care in network (except in an emergency)—while other plans cover both care in and out of network. However, if your health plan covers out-of-network care, staying in network can help reduce the amount you pay for healthcare.
