The American health care system has been the subject of much debate, especially the role of health insurance in the health care system. As you're considering the question of how proposed health care changes might impact your life, it's important to have a working definition of health insurance.
Identification
Like all insurance, health insurance requires the holder to pay a monthly or annual premium; in exchange, the holder gets certain benefits. In the case of health insurance, those benefits include assistance paying for medical treatments, including preventive and emergency care.
Types
There are three main types of health insurance. Private insurance is purchased by individuals for use by themselves and their families. Group insurance is insurance that's purchased by an organization or company and made available to employees or members. Government health insurance, including Medicare and Medicaid, is used to assist people who can't afford traditional health insurance and may be implemented at the local, state or federal level.
Benefits
Because health care can be expensive, especially in the event of unexpected illness or injury, health insurance can protect people against financial ruin. Health insurance also makes health care more accessible to more people, which can reduce the long-term burden of chronic disease care on taxpayers, according to the Congressional Research Service.
Considerations
Insurance coverage comes in several different varieties. Some insurance requires you to see doctors within a certain network in order to get full coverage for medical costs; other insurance requires you to pay a certain amount of your own money (called a deductible) before it will pay out benefits. Some insurance may cover mental health and complementary therapies, while other insurance is limited to specific kinds of care. It's important to understand what different insurance policies cover and cost so that you can make the decision that works best for your health and your budget.
Expert Insight
Be careful of bogus insurance companies that collect your money, but don't have legal authorization. According to Quackwatch.org, if the company offers very low rates, sidesteps around the word "insurance" in its printed materials and conversations, offers generous plans to people who have been rejected by other plans or isn't licensed in your state, it's best to work with another company.
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