The ACA was enacted in 2010 to broaden healthcare coverage and accessibility. Its key features include the establishment of a health insurance marketplace, safeguards for individuals with pre-existing conditions, and the definition of essential health benefits.
An alternative to health insurance that allows businesses to band together to purchase coverage as if they were a large employer. These types of plans lack regulatory oversight (since it is not health insurance).
A request for reimbursement from your insurance company for a medical service you received. Put into practice, when you go to the doctor or hospital, they send a bill to your health insurance company, just like sending a request for money. The insurance company looks at the bill, checks what's covered in your plan, and then pays the doctor or hospital for the things they promised to cover.
This is like a flat fee for medical services, usually paid upfront during the visit. The amount you pay may differ based on the type of service you get, which is usually explained in your health documents or health insurance card. For example, primary care visits may have a $25 copay, while visits to a specialist (like a cardiologist) may have a $75 copay. These are the fees you are required to pay at each visit and do not count toward your deductible.
Coinsurance is a percentage of the cost that you’re responsible for paying after you meet your deductible due to a hospitalization or surgery. It usually has to be paid at the time of the visit.
A deductible is the amount you have to pay out of pocket before your insurance coverage kicks in. For example, if you have a $1,000 deductible, you'll have to pay the first $1,000 of your medical expenses before your insurance will start covering your costs. Usually, the higher your deductible, the lower your premium.
An EPO is a type of health insurance plan that requires you to choose a primary care physician, but allows you to see specialists without a referral. These types of plans tend to be higher in cost than HMOs and lower in cost than PPOs.
A list of prescription drugs that your insurance covers. It's important to check your insurance company's formulary to make sure they cover the meds you need.
A type of health insurance plan in which the employer pays a fixed premium to an insurance company to provide coverage for their employees. These types of plans tend to be more common for small business owners and also the most expensive.
An HSA is a tax-friendly savings account that you can use to cover “qualified medical expenses”, which are expenses that meet the criteria outlined in the plan. It's an optional feature for folks with a high-deductible health insurance plan.
A high deductible health plan has a higher deductible (you could have figured that out!) than a traditional health insurance plan. The advantage is that these types of plans usually have lower premiums and can also be paired with HSAs.
An HMO is a type of health insurance plan that requires you to choose a primary care physician and only see providers within the network. An advantage of HMOs is that they typically have lower monthly premiums than other health plan types.
An HRA is like an employer-funded piggy bank that reimburses employees for medical expenses. It's also tax-deductible for employers and tax-free for employees.
Providers (hospitals, doctors, nurses, etc.) that are in cahoots with your insurance company are considered in-network. This means your insurance usually covers a higher percentage of the cost of services from these providers.
An ICHRA is an alternative to traditional group health insurance plans. It allows employers to give pre-tax money to their employees to be used to purchase individual health insurance plans.
This health insurance plan combines aspects of both self-funded and fully insured plans. While the employer assumes more risk than in a self-funded arrangement, the level of risk is still lower. If claims costs are lower than anticipated, the employer may receive a share of the surplus at the end of the year. If they are higher, premiums will jump. Generally, underwriting is necessary to access this type of plan, which involves inquiries about the employee's age, weight, height, and zip code.
The online health insurance exchange where individuals and small businesses can compare and purchase health insurance coverage.
The rate (AKA price) that a provider agrees to accept from your insurance company as payment for a medical service.
Providers that don't have an agreement with your insurance company are considered out of network. This means that you may have to pay a higher percentage of the cost of services from these providers.
Your out-of-pocket maximum is the most you'll ever have to pay for covered medical expenses in a year. Once you hit this limit, your insurance will take care of any extra eligible medical costs.
The period of time each year when you can enroll in or make changes to your health insurance coverage. For an individual health plan, the open enrollment period is typically from November 1 to December 15.
Your premium is the amount you pay every month to have health insurance. It's important to note that a higher premium doesn't always mean better coverage, and vice versa.
A pre-existing illness or medical condition means a health issue that was there before you got health insurance coverage. Just so you know, all plans that follow the Affordable Care Act don't take pre-existing conditions into account.
A PPO is a type of health insurance plan that allows you to see any provider, but will typically offer discounts for seeing providers within the network. PPOs offer more flexibility but also tend to be the highest cost of all available health plans.
A health care subsidy refers to financial assistance provided to individuals or families, typically based on total household income. This subsidy allows them to access health insurance exchange plans at a discounted rate. The amount of subsidy is different depending on where you live, your household income and family size.
This is a health insurance arrangement where the employer takes on the financial risk of providing healthcare benefits to its employees. Instead of paying fixed premiums to an insurance company, the employer directly covers the healthcare costs and manages claims payments. Usually, this kind of health plan is offered by big employers who can spread the risk across their workforce.
Usually, you can't sign up for health insurance once the open enrollment period is over. But there are moments when a special enrollment period can come up because of a "qualifying life event", like getting a new job, getting married, divorced, or having a baby.
