Health care is an expensive yet necessary investment in the United States. A single visit to a doctor for even the slightest of pain may cost you thousands of dollars. Many people can’t afford to pay a hefty sum of money for it. Health insurance offers a way to reduce such costs to more reasonable amounts.
How does it work?
It typically works that the consumer (you) pays an upfront premium to a health insurance company and that payment allows you to share “risk” with lots of other people (enrollees) who are making similar payments. Since most people are healthy most of the time, the premium dollars paid to the insurance company can be used to cover the expenses of the (relatively) small number of enrollees who get sick or are injured. Insurance companies, as you can imagine, have studied risk extensively, and their goal is to collect enough premiums to cover the medical costs of the enrollees.
There are many, many different types of health insurance plans in the U.S. and many different rules and arrangements regarding care.
When can you get care?
Many insurance companies contract with a specified network of providers that have agreed to supply services to plan enrollees at more favorable pricing.
If a provider is not in a plan’s network, the insurance company may not pay for the service(s) provided or may pay a smaller portion than it would for in-network care. This means the enrollee who goes outside of the network for care may be required to pay a much higher share of the cost.
What does the plan cover?
Plans in the U.S. are required to offer several “essential health benefits” which include
Emergency services
Hospitalization
Laboratory tests
Maternity and newborn care
Mental health and substance abuse treatment
Outpatient care (doctors and other services you receive outside of a hospital)
Pediatric services, including dental and vision care
Prescription drugs
Preventive services (e.g., some immunizations) and management of chronic diseases
Rehabilitation services
For our international population of students who might be considering coverage through a non-U.S.-based plan, asking the question, “What does the plan cover” is extremely important.
How much does it cost?
As a general rule of thumb, the more you pay in premium up front, the less you will pay when you access care. The less you pay in premium, the more you will pay when you access care.
