Medical costs, especially unexpected ones, can wreak havoc on your finances. Health insurance is an important expense that helps keep you and your loved ones safe when you need that added care.
What Is Health Insurance?
Health insurance, at the core, is a type of insurance coverage specifically designed to cover any sort of medical or surgical expense. Any sort of healthcare professional or service can be labeled as a “provider,” including:
- Doctors
- Clinics
- Hospitals
- Healthcare practitioners
- Pharmacies
- Specialists
Depending on what type of healthcare policy you have, you can either pay costs out of pocket and then be reimbursed, or have the insurer make all or some of the payment directly to the provider. The majority of the time, healthcare packages and policies are given by employers to their employees, but people who are not employed or have non-traditional employment, like freelancers and independent contractors, have to pay for their own policies.
There are several different types of health insurance policies out there, but it’s important to note that not all healthcare providers accept all types of insurance. Whether you buy your own policy or have one from your job, make sure to check in with a provider before seeing them to make sure they accept your insurance. In the case of managed-care plans, this is taken care of for you. The insurer will have contracts with its own network of healthcare providers to provide services at lower costs. Going out-of-network will add additional costs and penalties in some cases.
Why Do You Need Health Insurance?
The advent of the Affordable Healthcare Act means that health insurance is no longer an optional decision to make. Anyone who does not have some sort of policy will now be subject to a financial penalty, certainly something that no one wants to deal with. However, there are plenty of reasons to try and keep a health insurance policy rather than just compliance.
When it comes to certain types of insurance, it may be feasible to try and gauge whether or not it’s really something you need. For example, a homeowner who lives in a landlocked area with little flood history may be able to feel relatively confident about not having to buy flood insurance. However, with health insurance, there’s no such guarantee. Even a person who exercises and takes good care of themselves could still be at risk of various health conditions or end up being injured for another reason.
One of the most difficult things about extended healthcare needs is that not only do they cost a lot, but depending on the nature of your condition, you may be unable to work. This means a financial burden and a loss of earning power at the same time. Good health insurance is the best way to mitigate this issue.
If you are looking to understand more about health insurance and what your best options are, be sure to consult with your local insurance company right away. The professionals there can help guide you to the best policy for your circumstances.
