Health Insurance: What's Covered For People?

Health insurance is a contract between an individual and a company, where the company agrees to pay for all or some of the individual's healthcare costs in return for a monthly premium. In the US, health insurance is provided by both private companies and the government. Government-provided health insurance plans include Medicare, Medicaid, and the Children's Health Insurance Program (CHIP). These plans are typically aimed at older, disabled, and low-income people. Private health insurance can be obtained through an employer or directly from a health insurance company. While health insurance is not mandatory in the US, it is important to have as it offsets the costs of medical issues, including surgeries and treatments for serious ailments.

Health insurance premiums

A health insurance premium is the amount of money an individual or policyholder pays to the insurance company or health insurer in exchange for health insurance coverage. This is typically paid on a monthly basis, although some people may choose to pay annually. The premium is necessary to maintain active coverage and access the benefits outlined in the policy.

The premium is typically paid regardless of whether the policyholder uses any health services or not. However, if a policyholder does require medical treatment, they will also be expected to pay deductibles, coinsurance, and copayments. These are collectively referred to as "cost-sharing".

The amount of the premium is determined by various factors, including the type of plan, the level of coverage, the age of the insured person, their location, and other risk factors. Generally, older people will pay higher premiums than younger people due to increased healthcare needs. The location of the policyholder also plays a role, as the cost of healthcare varies by region.

In the United States, insurance companies can only take five things into account when setting premiums: age, location, tobacco use, plan category, and whether the plan covers dependents.

The average cost of a health insurance premium varies depending on the plan, the insurer, the geographical area, and the age of the enrollee. For example, the average full-price premium for people who buy their own coverage was $575 per month in 2020. However, very few enrollees pay the full price, as 86% received premium subsidies.

There are ways to lower your health insurance premium, such as by taking out a plan with fewer benefits or a smaller provider network. In the US, you may be eligible for premium tax credits or other subsidies if you meet certain income requirements.

Health insurance plans

When it comes to private health insurance, there are several types of plans available, each with its own unique features. Here are some of the most common types of health insurance plans:

Health Maintenance Organization (HMO)

HMOs provide insurance coverage through a specific network of healthcare providers. They typically have lower premiums due to the volume of patients directed to their network providers. However, subscribers are limited in their choice of doctors and must usually obtain a referral from a primary care physician before seeing a specialist.

Preferred Provider Organization (PPO)

PPOs offer a network of preferred or in-network providers who provide services at reduced rates. Subscribers can also choose to see out-of-network providers, but at a higher cost. PPOs offer more freedom in choosing healthcare providers and do not always require referrals for specialist visits.

Exclusive Provider Organization (EPO)

EPOs are a hybrid of HMO and PPO plans, allowing subscribers to receive services from providers within a specific network. Exceptions are made for emergency care. EPOs may require subscribers to choose a primary care physician for preventive care and minor illnesses.

Point-of-Service Plan (POS)

POS plans combine features of both HMO and PPO plans. They offer more freedom in choosing healthcare providers than HMOs, and subscribers have a primary care physician who coordinates their care and provides referrals. Out-of-network providers may result in higher costs and additional paperwork.

High-Deductible Health Plan (HDHP)

HDHPs have higher annual deductibles than other insurance plans, but they typically have lower monthly premiums. These plans are ideal for young or healthy individuals who don't anticipate frequent healthcare needs. HDHPs also offer access to a tax-advantaged Health Savings Account (HSA) to help pay for medical costs.

Catastrophic Coverage

Catastrophic health insurance is typically available to adults under 30 years old who receive a hardship exemption from the government. These plans have lower premiums but usually come with high deductibles, making them suitable for those who want basic coverage in case of a serious accident or illness.

Medicare and Medicaid

Medicare is a federal health insurance program for individuals 65 years or older, certain people with disabilities, and those with end-stage renal disease. It offers various coverage options, including prescription drug plans and Medicare Advantage Plans.

Medicaid, on the other hand, is a joint federal and state program that provides free or low-cost health coverage to low-income Americans, regardless of age. It covers a range of individuals, including families, children, pregnant women, and people with disabilities.

Health insurance appeals

If your health insurance company refuses to pay a claim or ends your coverage, you have the right to appeal the decision and have it reviewed by a third party. There are two ways to appeal a health plan decision: an internal appeal and an external appeal.

Internal Appeal

If your claim is denied or your health insurance coverage is canceled, you have the right to an internal appeal. You may ask your insurance company to conduct a full and fair review of its decision. If the case is urgent, your insurance company must speed up this process. Insurers have to tell you why they've denied your claim or ended your coverage, and they must let you know how you can dispute their decisions.

External Appeal

You have the right to take your appeal to an independent third party for review. This is called an external appeal or external review. This means that the insurance company no longer has the final say over whether to pay a claim. External appeals are generally conducted by independent review organizations (IROs). These third-party entities provide an objective review of claims disputes, relying on expert medical peer reviewers for medical necessity disputes and on insurance law experts for other contractual coverage disputes.

The No Surprises Act (NSA)

The NSA makes disputes over coverage of surprise medical bills eligible for external review. You may file an external appeal if your health plan issued a final adverse determination for specific reasons, including:

• The health plan determined that out-of-network emergency services received were not emergencies.
• The health plan determined that the out-of-network services received do not qualify as a surprise bill.
• Incorrect cost-sharing was applied to your bill for either emergency services or a surprise bill.
• There is a question about whether the claim for out-of-network care you received was coded correctly by the provider and accurately reflects the treatment you received, along with the associated NSA protections related to cost-sharing and surprise billing.

State Consumer Assistance Programs

Your state may have a Consumer Assistance Program (CAP) that can help you file an appeal or request a review of your health insurance company's decision if you are unsure what steps to take. The Affordable Care Act (ACA) authorized the establishment of CAPs to educate the public about their rights and protections under private health plans and to help consumers resolve disputes with their health plans, including filing appeals.

Health insurance and yoga

Yoga has been proven to have a positive impact on both physical and mental health. It can help with insomnia, PTSD, depression, anxiety, and stress. It has also been shown to have therapeutic effects on heart patients and can help with carpal tunnel syndrome, diabetes, fibromyalgia, and other conditions.

Despite these benefits, yoga is not typically covered by health insurance. However, this is slowly changing, and some progressive providers are beginning to cover or subsidize yoga memberships. In the U.S., some states require coverage of complementary health care, and some insurance companies cover many forms of complementary health therapies, such as acupuncture and massage.

If your health insurance does not cover yoga, there are still options to make it more accessible. Some yoga therapists are also certified medical professionals, such as psychologists, nurse practitioners, or physical therapists, and may be accustomed to working with insurance companies regarding reimbursement. Additionally, if you are self-employed and have a Health Savings Account (HSA), you may be able to use it to pay for yoga therapy.

Yoga has become increasingly popular, and with growing evidence of its health benefits, it is likely that more insurance companies will begin to cover it in the future. In the meantime, there are affordable options available, such as local community yoga classes that are often complimentary or donation-based.

Health insurance and mental health

Mental health is just as important as physical health, and in recognition of this, most health insurance plans now include mental health coverage. In the United States, the Mental Health Parity and Addiction Equity Act (MHPAEA) was passed in 2008, requiring that mental health, behavioural health, and substance use disorders be treated equally to physical health coverage in insurance plans. This means that insurers must treat financial requirements for mental health services in the same way that they would for physical health services. For example, if an insurance company charges a $20 copay for most medical office visits, they cannot charge more than this for a visit to a mental health professional.

Despite this, many people are still unaware of the MHPAEA and how it affects them. A 2014 survey by the American Psychological Association found that over 90% of Americans were unfamiliar with the law.

Mental Health Coverage in Practice

Mental health benefits in an insurance plan can be a valuable resource, improving access to treatment and reducing out-of-pocket spending. They can also improve health outcomes, especially for lower-income populations. However, there are still some issues with the implementation of mental health coverage.

Challenges and Limitations

While insurers cannot deny coverage or charge more for pre-existing mental health conditions, they often manage care or create networks in ways that prevent equal access to services. Insurers may set treatment limits, require prior authorisation, or implement restrictive network adequacy standards, making it difficult for patients to find in-network providers who accept their insurance. These limitations mean that, in practice, parity is not always achieved.

Affordability

Affordability remains a significant barrier to accessing mental health services, especially for low-income individuals and families. Even with insurance, high copays and deductibles can make treatment unaffordable for many. This is particularly true for long-term treatment, as mental health disorders often require ongoing care such as talk therapy or rehabilitation.

Provider Acceptance

Psychologists and other mental health providers can choose whether or not to accept insurance, and low reimbursement rates from insurance companies can be a disincentive for providers to join networks. This can result in limited networks and reduced access for patients.

Recent Developments

Despite the challenges, there have been some positive developments in the area of health insurance for mental health. The Affordable Care Act (ACA) has improved access to mental health services by requiring that all plans offered through health insurance exchanges cover mental health and substance use disorders. Additionally, the enactment of the Mental Healthcare Act (MHCA) in 2017 in India has brought mental illness coverage under the ambit of insurance, contributing towards achieving universal health coverage.

While there have been significant strides in recent years, there is still work to be done to ensure that mental health coverage is accessible and affordable for all who need it. Further enforcement of existing parity laws and improvements in reimbursement rates for providers could help to increase access and reduce barriers to care.

Frequently asked questions