Benefits 101

Health insurance is an arrangement with an insurance company that can help protect you form the high costs of health care. It works by spreading the cost of care among large groups of people. In addition to spreading financial risk, health insurance improves access to health care services.

The provider is the clinic, hospital, doctor, laboratory, health care practitioner or pharmacy that provides medical services.

The insurer or carrier is the insurance company providing coverage.

The policyholder is the individual or entity that has entered into a contractual relationship with the insurance company.

The insured is the person with the health insurance coverage.

For group health insurance, your employer will typically be the policyholder and you will be the insured.

The premium is the amount of money charged by the insurance company for coverage. Employers determine how much of the premium employees must pay for coverage (usually paid pre-tax).

A copayment, or copay, is a fixed amount you pay for a covered healthcare service, usually when you get the service. The amount can vary by the type of covered health care service.

A deductible is the amount you owe for health care services each year before the insurance company begins to pay.

Coinsurance is your share of the costs of a covered health care service calculated as a percent of the allowed amount for the service.

An OOPM is the most you should have to pay for your health care during a year, excluding the monthly premium. It protects you from very high medical expenses. After you reach the annual OOPM, your health insurance or plan begins to pay 100% of the allowed amount for covered health care services or items for the rest of the year.

Preventive care refers to measures taken to prevent chronic illnesses and catch illnesses in their earliest, most treatable stages. This includes medical tests, immunizations, screening tests, preventive medications, and any other services that would prevent disease. Under the Affordable Care Act (ACA), non-grandfathered health insurance policies must provide coverage for a range of preventive services and may not charge any copayments, deductibles, or coinsurance to patients receiving preventive care.