What is an HMO?
It means Health Maintenance Organization because it only covers services from a designated organization of doctors, specialists, and hospitals. This type of insurance plan gives you a primary care physician (PCP) who refers you to specialists that accept HMO insurance. HMOs are typically cheaper than PPOs.
What is a PPO?
It means Preferred Provider Organization because you may visit doctors and specialists in your insurance plan's "preferred network" without referrals from a PCP. A PPO prefers to cover services in a PPO network, but if you visit a doctor who doesn't accept PPO insurance, your insurance may pay for some or none of it. This plan gives you more flexibility but usually has higher premiums.
What is a Primary Care Physician (PCP)?
Under an HMO, you're assigned a Primary Care Physician, who is your go-to doctor. If you want to visit a specialist, your PCP must write a referral. In emergencies or for an OBGYN, you don't need a PCP referral.
What is a referral?
This is a recommendation from your PCP to visit specialists within the HMO network, such as: dermatologists, urologists, proctologists, etc.
What is a copay?
It's the amount you pay for a doctor's visit or prescription. Preventive care services: screenings, vaccines, blood tests, birth control, and annual check-ups are free.
What is a premium?
It's the amount you pay each month to keep your insurance plan. The amount you pay for your premium does not count toward your deductible or out-of-pocket limit.
What is a deductible?
It's the amount of money you pay before the insurance company pays for its share. If your deductible is $500, you're responsible for paying $500 of whatever health service. After you pay your deductible, your insurance company will cover a percentage of the rest of the bill, depending on the plan's "metal tier":
Bronze: After your deductible, your insurance pays 60% of the remaining bill.
Silver: After your deductible, your insurance pays 70% of the remaining bill.
Gold: After your deductible, your insurance pays 80% of the remaining bill.
Platinum: After your deductible, your insurance pays 90% of the remaining bill.
You may notice most plans have cheaper premiums if the deductible is higher. If the premiums are higher, the deductible is usually less expensive.
What is out-of-pocket?
It's what you pay for health services (including your deductible) until you reach your out-of-pocket limit (sometimes called "maximum"). After you reach your out-of-pocket limit, your insurance company covers all expenses for the rest of the year.
What is Covered California?
Covered California is an organization also known as an "exchange" or "marketplace" set up by the Affordable Care Act. It is a non-governmental entity that provides health insurance for low to middle income families through various insurance companies. Big name providers like Anthem Blue Cross, Kaiser Permanente, and Health Net have Covered California insurance plans you may be eligible for.
To be eligible for Covered California, you must meet a certain income level depending on your age, location, and family size. A certified insurance agent who passed Covered California background checks and tests can easily enroll you. If you don't qualify for Covered California insurance, no sweat. You can still sign up for private insurance, but you won't get financial assistance. They're called "private" plans because the government doesn't help pay for you, which in a way seems more private.
What's in My Insurance Plan?
Covered California insurance plans come with 10 essential benefits, including pediatric dental and vision. They also include financial assistance for some individuals and families. This assistance (called "subsidies" or "tax credits") is easy to apply for. Ask an agent to start an application and calculate how much financial assistance you can get by choosing Covered California.
What are Subsidies (Tax Credits)?
Health insurance subsidies are simply amounts of money the government is willing to pay toward your health insurance so it's affordable to you. If you're eligible for subsidies, the government will automatically pay part of your insurance premium each month. You just have to pay the rest. On your monthly statement, you'll see how much the government pays directly to the insurance company. An individual who earns a gross annual income between about $16,000 and $44,000 usually qualifies for health insurance subsidies. A family of four who grosses more than $88,000 usually qualifies.
Someone who earns more than the qualifying income bracket for Covered California can still sign up for private insurance plans, which are offered by all the same companies that work with Covered California. Private insurance plans come with 10 essential benefits as well, but not financial assistance.
What is the Affordable Care Act?
Also known as "Obamacare", ACA isn't a type of insurance but rather a new set of rules for the insurance industry. One of the major changes under Obamacare is the start of exchanges, like Covered California. Now preventive care: immunizations, annual check-ups, birth control, and more are free.
Another cool thing about Obamacare is young adults can stay on their parent's insurance plan until they turn 26. Then they're on their own. Every insurance plan guarantees kids under 18 get vision, dental, and health care. Adults can still choose dental and vision plans on the side.
Open enrollment periods are the only times to sign up for health insurance, unless you have a qualifying life event.
