This is the traditional kind of health care
policy. Insurance companies pay fees for the services provided to the
insured people covered by the policy. This type of health insurance
offers the most choices of doctors and hospitals. You can choose any
doctor you wish and change doctors any time. You can go to any
hospital in any part of the country.
the insurer only pays for part of your doctor and hospital bills. This
is what you pay:
- A monthly fee, called a premium.
- A certain amount of money each year, known as the deductible,
before the insurance payments begin. In a typical plan, the deductible
might be $250 for each person in your family, with a family deductible
of $500 when at least two people in the family have reached the
individual deductible. The deductible requirement applies each year of
the policy. Also, not all health expenses you have count toward your
deductible. Only those covered by the policy do. You need to check the
insurance policy to find out which ones are covered.
After you have paid your deductible amount for the year, you share the
bill with the insurance company. For example, you might pay 20 percent
while the insurer pays 80 percent. Your portion is called coinsurance.
To receive payment for fee-for-service claims, you may
have to fill out forms and send them to your insurer. Sometimes your
doctor's office will do this for you. You also need to keep receipts
for drugs and other medical costs. You are responsible for keeping
track of your medical expenses.
There are limits as to how
much an insurance company will pay for your claim if both you and your
spouse file for it under two different group insurance plans. A
coordination of benefit clause usually limits benefits under two plans
to no more than 100 percent of the claim.
fee-for-service plans have a "cap," the most you will have
to pay for medical bills in any one year. You reach the cap when your
out-of-pocket expenses (for your deductible and your coinsurance)
total a certain amount. It may be as low as $1,000 or as high as
$5,000. Then the insurance company pays the full amount in excess of
the cap for the items your policy says it will cover. The cap does not
include what you pay for your monthly premium.
services are limited or not covered at all. You need to check on
preventive health care coverage such as immunizations and well-child
There are two kinds of fee-for-service coverage:
basic and major medical. Basic protection pays toward the costs of a
hospital room and care while you are in the hospital. It covers some
hospital services and supplies, such as x-rays and prescribed
medicine. Basic coverage also pays toward the cost of surgery, whether
it is performed in or out of the hospital, and for some doctor visits.
Major medical insurance takes over where your basic coverage leaves
off. It covers the cost of long, high-cost illnesses or injuries.
Some policies combine basic and major medical coverage
into one plan. This is sometimes called a "comprehensive plan."
Check your policy to make sure you have both kinds of protection.