A guide to US health insurance

As of 2011 in the United States, health insurance still remains a private market affair. While the Obama care package going into effect in 2014 aims to make insurance available to more Americans, in 2011, insurance can still be expensive and there are many Americans who struggle to afford insurance or who are unable to obtain insurance at all. Understanding medical insurance prices and how insurance works in the US is essential to anyone wishing to protect their health.

HMO and PPO

When you purchase insurance yourself or through a group plan, most of the time this insurance will either be a PPO or an HMO. What is a PPO? A PPO is a preferred provider network. For the most part, when you have private insurance through a PPO, you do not need to get referrals before getting medical care as long as you go "in-network," which means you choose a doctor from the list. What is an HMO? An HMO is a health maintenance organisation where you receive managed care. This generally means you must get a referral from your primary care physician. HMO and PPO insurance must be paid for by either you or by your employer or both. Buying these types of insurance can be prohibitively expensive if you are not part of a group plan.

Major medical plan

A major medical plan is also called a catastrophic care plan. These provide individual insurance for serious medical emergencies at a lower cost. The premiums on a major medical plan that you are required to pay can be much lower than what you would pay for an HMO or a PPO. However, routine doctors visits and costs are not covered. You will have a deductible of several thousand dollars and the health insurance will kick in only when you have already spent this annual deductible.

Medicare and Medicaid

Medicare and Medicaid are insurance offered by the government to people who cannot otherwise afford or obtain insurance. Medicaid is provided to low income individuals and children who qualify based on making below a set amount and not having many resources. Medicare is available to the elderly and provides coverage for medical needs as well as for prescriptions.