Health insurance coverage normally refers to the schedule of benefits and exclusions that apply under a contract of insurance, normally referred to as a health insurance plan or a health insurance policy between an individual and an insurance company.
In this context, health insurance coverage can also refer to a health insurance plan or policy that is paid for by an employer on the half of the individual, but is the individual’s own health insurance plan.
Health insurance differs quite widely from other types of insurance in one particular regard, in that there is a very specific level of detail as to what benefits are provided, what health care providers may or may not be used and the levels of cost involved.
An insurance company will have a range of their own health care providers that they require the policyholder to use, and these are normally referred to as an in network range of hospitals, doctors and other healthcare providers.
An insurance company may allow a policyholder to use other healthcare providers who are not included in their network and these are known as out of network health care providers.
If an insurance company does allow out of network providers to be claimed for under the policy, then the costs as such will be proportionately much higher than if the policyholder used and in network provider.
Networks
The idea is to require the policyholder to use and in network doctor or hospital with whom the insurance company has negotiated specific costs and other benefits. This obviously makes sense from an insurance company’s point of view in that they can contain levels of cost within certain limits, but this also limits the policyholder as to which health care provider they can use.
This limitation applies to both individual hospitals and doctors, as well as a geographical limitation as to where their health insurance coverage applies. An insurance company which operates and in and out of network system of health care providers will also buy very definition have a geographical limitation as to where the network applies.
This may have real indications for an individual, and needs to be a consideration when taking out any type of health insurance plan or policy. Health insurance coverage will normally require an individual to pay a proportion of all costs that are incurred under the policy by way of what is known as a coinsurance clause.
This effectively means that the insurance company will pick up the bulk of any claim, but an individual may be liable for a percentage, sometimes as low as 20%, but sometimes as high as 100%. The annual premium will be adjusted accordingly. In addition the policyholder will have a range of deductibles that apply before any claim can be made on the policy. This can increase the cost significantly.
