Health Insurance is a type of insurance that covers the medical and surgical costs of an insured individual. Depending on the type of insurance you have purchased, either you can pay out of pocket for your medical expenses, and the Insurance company reimburses your costs, or the insurance company directly pays the healthcare providers. The type of insurance plan you choose is important, how you will approach the treatment you need and what types of costs the insurer will cover.

Types of Health Insurance

There are two primary types of health insurance – private health insurance or public or government health insurance.

Private health insurance refers to insurance offered by a private entity instead of the state or government. Both insurance brokers and companies are included in this. Private health insurance plans include employer-sponsored health insurance and individual health insurance.

Public health insurance refers to programs run by the federal, state, or local government that subsidizes a percentage of the insured individual’s healthcare costs. Some public health insurance plans include Medicare and Medicaid.

Legislation

In the United States, purchasing some sort of health insurance is legally necessary according to the Affordable Care Act. A person with no health insurance will have to pay a fine. However, the individual mandate was removed from the Affordable Care Act legislation in 2019. So, an individual does not legally require separate insurance. Children can use their parent’s health insurance if it covers children and family, up to the age of 26 years. Offspring can do this even if they are married or living away from home. This also applies even if they are not financially dependent on their parent or are eligible to be included in their employer’s coverage.