Health Insurance Basics
Health Insurance is a means for financing health care by spreading your risk over a large segment of the population. Yes, you give more than you receive when you are healthy, but you pay less than the actual cost of your treatment when you are unhealthy. This is because the healthier folks in your segment of the population will be helping pay for your health care. And everyone will, at some point in their life, become unhealthy.
Do You Need Individual or Group Insurance?
Individual/Family Health Insurance, whether for one person or a family, is purchased in the individual/family marketplace. Plans are offered by a number of insurance companies, typically called carriers, and may vary widely in both costs and benefits. In Virginia, as in most states, there are a number of mandated benefits which all plans must cover, except for so-called “mandate lite” plans, which cost less but do not include all the state-mandated benefits. Optional benefits, such as maternity or dental coverage, may be purchased for additional monthly premium by folks who need them. Individuals and families may also purchase dental, vision, life, disability, long term care, or other insurance separately.
Group Health Insurance covers multiple individuals/families, all of which are employed by the same company or, in some cases, association of companies. Plans may be fully insured, where an insurance company is paid to assume the financial risk associated with the group’s health care, or self insured, where the employer assumes the financial risk. Most companies with less than 500 employees are full insured. Companies may also offer group dental, vision, life, disability, long term care, or other insurance.