subject: Learn About The Definitions For Purchasing Individual Health Insurance In Virginia [print this page] In order to secure the best individual health insurance plan in Virginia, it is important to learn the definition used for purchasing a health plan. Almost every article, every expert-advice or even a general remark about purchasing health insurance would mention that you should learn the definitions of terms used in a health plan very clearly.
In this article, we provide some of the most important ones.
Premium
Premium is usually charged monthly and sort of a fee that ensures that you continue your health insurance plan. The amount of premium charged for an individual health insurance plan depends on your health condition, age, location, your place of work etc. and also on the kind of coverage it provides.
Deductible
Deductible is the amount that you spend towards your health care before your plan begins the coverage. It is not a regular cost but could have an impact on the premium. For example, if your health insurance plan has a deductible of $2000 and your medical bills are of $5000, then the insurance company would pay towards your healthcare expenditure, once you have paid $2000 yourself. With higher deductible costs, an individual health insurance plan has lower premium costs.
Copayments and coinsurance
Copayment, as the name sounds, is the amount that an insured person has to pay for every visit to the doctor. It is often only a small portion of the actual cost of the medical service rendered by the doctor. A larger portion of the fee is borne by your insurance carrier. Apart from doctors visit, it ca also apply to medicinal drugs, especially generic drugs.
Coinsurance is similar to copayment, except its expressed as a percentage rather than a dollar amount.
Out of pocket maximum
As the name clearly defined, the yearly out-of-pocket maximum is the highest or total amount your health insurance company requires you to pay towards the cost of your health care.
Lifetime maximum
It is the maximum amount that your insurance would pay for services rendered during the life time of the plan.
by: Shaun Mike
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