Understanding the Basics of Health Insurance
Health insurance is a contract between you and your health insurance carrier that helps pay for medical care and services – both planned and unplanned. There are different types of health insurance plans to meet your unique needs. Health insurance can be confusing, so let’s start with the basics.
Types of Health Insurance Coverage
Different health insurance coverage options may be available to you depending on your age, employment situation, and financial qualifications. These include:
Individual and family plans. These are available through private insurance carriers, like RMHP, or a health insurance marketplace, like Connect for Health Colorado.
Medicare coverage for individuals aged 65 and older, or those who are younger with certain medical conditions. Private insurance carriers, like RMHP, offer certain types of Medicare plans.
Medicaid coverage for those who qualify based on income. Health First Colorado is Colorado’s Medicaid program.
Employer group plans that may be offered through your work.
How Health Insurance Works
When you need medical care, you visit a health care provider. You and your health insurance plan work together to pay for your care. Your health insurance plan pays a portion of medical services, and you are responsible for any cost-sharing amounts, like deductibles, copayments, and coinsurance. These cost-sharing amounts are called out-of-pocket costs and you pay them each time you receive care. You can also use health insurance even when you’re feeling well for no-cost preventive care services, like vaccines, some annual wellness visits, and screenings.
A common question is, how do health insurance deductibles work? Your deductible is the amount you must pay before your plan begins to pay for your covered medical care. Some plans have high deductibles and lower monthly premiums. Other plans have low deductible amounts, but higher premiums. Once you meet your deductible, you may be still responsible for a copayment or coinsurance depending on your plan’s structure. However, some plans include an out-of-pocket maximum, which caps what you pay. Your health insurance plan pays for 100% of covered services once you reach this amount.
Considerations When Choosing an Individual & Family Plan
It can be difficult to know where to begin when shopping for a plan because there are so many options available. Here are important considerations when finding an individual and family plan:
Is it compliant with the Affordable Care Act (ACA)? All ACA-compliant plans must meet minimum requirements for coverage, including essential health benefits. These include:
Hospitalization, including surgery and overnight stays
Pregnancy, maternity, and newborn care (both prenatal and postnatal)
Mental health and substance use disorder services, including behavioral health treatment
Rehabilitative and habilitative services and devices
Preventive and wellness services
Chronic disease management care
Pediatric services, including oral and vision care
What is the total cost for care? Be sure to consider any cost-sharing responsibilities in addition to your monthly premium amount when determining expected total costs. The health plan’s metal category can affect what you pay. There are four categories: bronze, silver, gold, and platinum. These categories determine how you and your health insurance plan split costs. For example, a bronze plan has the lowest monthly premium, but highest costs for when you receive care. A bronze plan may be right for you if you want coverage for worst-case medical needs at a low monthly cost. A gold plan, on the other hand, has a high monthly premium, but low costs for receiving care. You may want to consider a gold plan if you expect to receive regular medical care throughout the year.
Which type of network does the plan have, and is your provider in-network? Some plans require you to see a provider in that plan’s network of doctors, hospitals, and pharmacies. Other plans will pay for care you receive from a provider who is out-of-network – someone who is not contracted with your health plan – although they may require you to pay more.
Learn More and Find Your Plan
Find more information about common health insurance terms, including copayment, coinsurance, and out-of-network definitions, using this helpful glossary. Still have questions or want more information? We’re here to help. Contact us to learn more about our plan offerings and how to find the plan that’s right for you and your family.