Health Insurance helps the insured person to cover medical expenses due to the illness. The insured person pay the periodically premium and in exchange of this the insurance company provides health cover to the insured person.
In this article you will get an idea about health insurance, its types and benefits, meaning of different terms, insurance providers in India etc.
What is Health Insurance?
Health insurance is the contract between insured person and insurance provider in which the insurance provider fully or partly covers the medical expenses of insured due to the illness for which the insured person has to pay periodically premium or co-insurance.
The health insurance company connects number of hospitals and other healthcare centres specialist together to provide health services to the insured person registered with the insurance company.
The insured person has to pay less when he take health care from the in-network physician.
The some policies also allows the insured person to take service from the physician who is not the part of network. The health insurance protects your savings while facing to the medical inflation.
Benefits of health insurance :-
The health insurance provides following benefits to the insured person or his family.
1) The health insurance provides financial security to the insured person for medical expenses.
2) It protects your savings while dealing with Medical services.
3) It protects you and your family for expensive treatments.
4) The insured can get cover for serious disease.
5) Some policies provides free of cost preventive health services at in-network physician.
6) It helps to face medical inflation.
7) It also provides tax benefits to the insured person.
8) Less worry about future medical expenses.
Types of health insurance policies :-
The health insurance policies are classified into the different types based on the requirements of the insured person which are listed below:
1) Health maintenance organisation (HMO’s)
2) Preferred provider organisation (PPO’s)
3) Exclusive provider organisation (EPO’s)
4) Point of service plans (POS)
5) High deductible health plans (HDHP’s)
Let’s discuss about each one of above types,
1) Health maintenance organisation :-
Health maintenance organisation provides health insurance coverage for the specified period for fixed yearly fees also known as premium.
In this type of health insurance the health service is provided by the doctors which are in HMO’s contract.
It is generally a network of physicians and organisations which provides health services. In this category of Health Insurance the premium cost is lower as it is generally offered for the basic medical care and early check-up etc.
The HMO’s not has any limit on visits for primary care.
Working of HMO’s :
In HMO’s system the primary care physician (PCP) like pediatrician, family doctor, general practitioner which are connected to the HMO’s access basic health service provider like general check-up yearly check-up etc.
The primary care physician is paid by HMO’s for each health service provided to the insured person.
In case if there is need to visit a specialist physician the primary care physician provides referral for visiting specialist physician.
Types of HMO’s :
The HMO’s has four types which are listed below
i) Staff model: In this type of HMO’s model the HMO’s hire physician and experts as their employees which works in the building owned by HMO’s.
In this type of HMO’s the physician sees only the HMO’s insured person registered with HMO.
ii) Group model: In this type, the HMO makes contract with the multispeciality organisation to provide health service to the insured person.
But the physician into this type of HMO only see the the persons register with HMO’s.
iii) Open panel model HMO’s: In this type of service the HMO’s contracts with the independent multispeciality organisations which means that the physician can treat the patient other than HMO’s. In this model the primary care physician provides referral to the insured person for the specialist visit.
iv) Network model: In this model the HMO contracts with the multiple multispeciality organisations and physicians to provide healthcare to the insured people.
Advantages of HMO’s :
By purchasing the HMO’s policy, you can avail following benefits :-
A) It has lower premium plan
B) No restrictions on number of primary visits
C) Low drugs cost
D) No claim registration
Disadvantages of HMO’s :
A) The insurance cover is available for visiting in-network medical service providers only
B) You need to find the physician who is the part of network of HMOs
C) It requires referral from your primary health care doctor in case to visit specialist.
D) It not covers insurance cover for physician not from in-network of HMO’s.
2) Preferred provider organisations :
In preferred provider organisations the insurance companies make contract with doctors, hospitals, specialists and multispeciality organisations to provide health service to the insured people. This policy is also known as participating provider organisation.
In this type of health insurance if the insured person receives the health service in the network of PPO’s then the insured has to pay less amount.
The insured person can meet doctors outside of the network of PPO’s but in this case the insured person has to pay more.
The monthly/ premium is higher in case of preferred provider organisation.
Working of preferred provider organisation :
In preferred provider organisation the insurance company makes contract with the network of doctors, hospitals, multispeciality organisations, specialist etc.
If the insured person visit the physician from this network the insured person has to pay less for the health service.
insured person can also visit the doctors outside of the network but in this case the person has to pay more for the health service.
Person can also visit to doctors outside from his region while travelling.
Advantages of preferred provider organisations :
The preferred provider organisation has following features and advantages.
1) Large network of health service providers
2) It also allows visit to the doctors for hospitals outside of the network
3) Lower pay if visit to the in-network physician.
4) No need to visit primary care physician for visiting to the specialist
Disadvantages of PPO’s :
1) Extra pay to visit outside of network
2) Higher monthly premium
3) Exclusive provider organisations (EPO’s) :
In this type of health insurance the insured person can get the health service from the in-network physician, hospital and specialists.
In this policy the cover is not provided for the external visits.
In case of emergency policy also covers for the visits other than in-network physicians.
The major advantage of this health insurance is that the insured person require no referral from primary physician to visit specialist and he can directly visit to the specialist.
Advantages of EPO’s :
The following are the advantages you can avail by getting EPO’s policy.
i) Large network of multispecialist organisations and physicians.
ii) No referral required to visit specialist
iii) In case of emergency the external visits are covered by this policy
iv) Moderate premium cost
Disadvantages of EPO’s:
i) No cover is allowed for visiting physician outside of network other than emergencies.
4) Point of service plan (POS) :
In this type of Health Insurance the advantages of health maintenance organisation and preferred provider organisation are combined to provide ease to the insured person.
In this plan the insured person has to select primary care physician from the network of point of service plan.
The primary care physician provides primary health services to the insured person and in the case of visit to the in-network specialist the PCP provides referral.
In the point of service plan the insured are also allowed to visit physician outside of the network and in such a cases the insurance company pays less compensation.
The insured person has to complete the documentation for claim in case of visits to the outside network physician.
Working of point of service plan :-
In this point of service plan the insured person has to select a primary care physician who will provide Health care. In this plan you can choice the physician or specialist where you wish to take health care service. He can choose the in network physician or any other physician who is not in the network of service provider.
In case of a in-network specialist the primary care physician provides referral to visit specialist.
In another case you can visit the medical service of your choice but in this condition you have to pay more than in network services and also the insured person has to fill and submit documents to claim the benefits.
Advantages of point of service plan :-
By purchasing point of service plan you can avail following advantaes.
i) Wide range of physicians and specialists
ii) Less pay for in network physicians, health experts
iii) The insurance company also provides cover for physician other than network
iv) Moderate cost of premium
Disadvantages of point of service plan :-
i) Less coverage for visit to the physician outside of network
ii) PCP referral is required to meet specialist
iii) The insured person has to complete documentation to claim benefits for visiting external physicians.
5) High detectable health plans (HDHP’s):
In high deductible health plans the premium worth is lower while deductible worth is higher.
In this plan you have to pay deductible amount to the insurance company as per the plan choosen by you and then only insurance company starts pay for eligible medical expenses.
The HDHP’s plan provides hundred percent cover for the preventive care at the in-network physicians and health organisations.
Working of high deductible health plans:
In this high deductible health plan the insured has to pay the deductible amount as per the worth of plan.
In the cover period the insurance company has provided free preventive care into the in-network healthcare centres while in case of other services the expenses are firstly deducted from your deductible amount and after your deductible amount is exhausted then the insurance company pays the expenses of healthcare.
Advantages of HDHP :-
By purchasing HDHP you can avail following benefits and advantages.
i) lower premium cost
ii) Preventive health services are free into the in network physician
Disadvantages of HDHP :-
i) Higher deductible cost
ii) The insured has to pay higher initial as the deductible cost before coverage period.
Meaning of terms used in health insurance :-
The following are commonly used terms in case of health Insurance and we have stated its meaning.
A) Premium : It is the fees amount paid by insured person to the insurance company to provide insurance cover.
B) Network: It is the group of physicians or multi specialist organisations to which the insurance company makes contract for providing Health services.
C) Primary care physician : It is the primary care provider or physician who is connected with the insurance company and provide the health service to the insured persons.
D) Insurer : It is an insurance provider company which connects insured person with the organisation.
E) Coinsurance : It is a percentage of amount paid by the insured person after the deductible amount is over.
Along with this primary terms the health insurance also has more terms which will help you to understand the policy.
Diseases not covered by health insurance :-
There are some diseases which are not treated under the health insurance plan are listed below.
A) Cosmetic surgery : Cosmetic treatments which are not regarded necessary for preserving once quality of life are not covered by the health insurance policy.
eg. Facelift, Rhinoplasty etc.
B) Self inflicted injury : The injuries which caused intentionally or due to the suicide attempt are not covered under health insurance policy.
C) Sexually transmitted diseases are also not covered under health insurance policy e.g.: AIDS.
D) Non allopathic treatment : Some of the non allopathic treatments are not covered by health insurance.
E) Pregnancy treatment : Pregnancy treatment are not covered in health insurance policies.
F) Health issues occur due to the bad lifestyle habits like drinking alcohol, drugs consumption smoking are not covered under health insurance policy.
Cancellation of health insurance policy :
Choosing the right policy for your family is important, but sometimes people select false policies which may not suit for their requirements. Hence peoples generally wants to replace it or sometimes wants to terminate the policy.
To cancel the health insurance policy the policy holder has to talk with their policy providers.
The insurance company provides cancellation form to the policy holder which should be filled duly by the policyholder and it also contains the reason of cancellation.
The insurance company process your request for cancellation and pay the refund amount if you are eligible.
Cancellation refund :
The health insurance company gives free look period in which the policyholder person can cancel the policy if he is not satisfied with it.
In case if the policy holder applies for cancellation within free look duration then Insurance Company gives 100% refund to the policyholder.
After the free look period the policyholder never gets full refund.
Percentage of refund decreases with increase in time period between policy purchase and cancellation.
Health insurance provider organisation in India :
The following are some of the companies which provides different policies under health insurance.
A) Care Health Insurance
B) Chola mandalam Health Insurance
C) Digit Health Insurance
D) Bharti axa Health Insurance
E) Edelweiss Health Insurance
F) Bajaj allianz Health Insurance
G) Future Generali Health Insurance
H) Kotak Mahindra Health Insurance
I) IFFCO tokio Health Insurance
J) Aditya Birla Health Insurance
Along with these providers there are much insurance providers in India which provides health insurance policies.
Therefore the health insurance protects insured persons and their families from the diseases with high medical expense. The right health insurance plans will definitely help the insured person at the time of medical inflation.