20 Health Insurance Terms You Need To Know Before Applying

When you’re shopping for health insurance, it’s important to know what all the terms mean so that you can make an informed decision. Here are 20 of the most important health insurance terms that you need to know before you apply:

HMO: Health Maintenance Organization. An HMO plan offers a wide range of services through a network of providers that have been contracted by the HMO.

EPO: Exclusive Provider Organization. An EPO plan is similar to an HMO, but it also allows you to receive services from providers outside of the network for an additional cost.

PPO: Preferred Provider Organization. A PPO plan gives you the flexibility to receive services from any provider, but you will get a discount if you use providers that are in the network.

Deductible: The amount of money that you have to pay out-of-pocket for medical expenses before your insurance company starts to pay.

Copay: A fixed amount that you pay for a covered service. For example, you may have a $20 copay for a

doctor’s visit.

Co-Insurance: A percentage of the bill that you have to pay for a covered service. For example, you might be responsible for 20% of the cost of surgery.

Out-of-Pocket Maximum: The most amount of money that you have to spend for covered medical expenses in a year. After you reach your out-of-pocket maximum, your insurance company will pay for all of your covered expenses.

In-Network Provider: A healthcare provider that has an agreement with your insurance company to offer services at a discounted rate.

Out-of-Network Provider: A healthcare provider that does not have an agreement with your insurance company and may not offer discounted services.

Preventive Care: Medical services that are designed to prevent or detect illness or injury, such as annual physicals or screenings.

Prescription Drugs: Medications that are prescribed by a doctor or other healthcare provider to treat a medical condition.

Network: The healthcare providers and facilities that your insurance company has contracts with to provide services at a discounted rate.

Prior Authorization: The process of getting approval from your insurance company for medical services or procedures (such as surgery) before they are done.

Exclusions and Limitations: Services or benefits that are not covered by your insurance policy. For example, some policies may exclude coverage for certain types of treatments or drugs.

Pre-Existing Conditions: A medical condition that developed or existed before you purchased your health insurance policy.

Out-of-Pocket Expenses: Medical expenses that you have to pay out-of-pocket before your insurance company will pay for them.

Renewal: The process of re-enrolling in your health insurance plan after it has expired. Open Enrollment: The period in which you can purchase or change your health insurance plan.

Premium: The amount of money that you pay to your insurance company each month for your health insurance coverage.

Long-Term Care: Health care services provided over an extended period.

Summary

: Knowing the terms above can help you make an informed decision when it comes to selecting a health insurance plan. It is important to understand what is covered, what is excluded, and what level of coverage you need to make the best choice for you and your family.