There are many types of private health insurance coverage, which you might get through your employer, the marketplace, or an individual plan. Common types of plans include:

• HMO (Health Maintenance Organization)
• PPO (Preferred Provider Organization)
• ACO (Accountable Care Organization)
• HDHP (High Deductible Health Plan)
• Limited Benefit Medical Plan

Sometimes, a plan may be combined with an:

• HSA (Health Savings Account) or
• HRA (Health Reimbursement Account).

To understand your policy it is a good idea to have the written policy to read for yourself. The written policy (which may look different than a website or yearly packet) explains what benefits are covered and are not covered, the insurance company's obligations, your obligations, and how to appeal if a claim is denied. Your policy’s Summary page is likely to be online. You can also ask your job’s Human Resources department to print it out for you.

Most people are not experts on medical coverage, but with an understanding of the basics, you will be able to ask the right questions. Start by identifying your coverage, which will depend on what type of plan you have. It is wise to understand your benefits before seeing a provider.

Some Terms to Understand

Health Maintenance Organization (HMO)
Under this type of plan, you must use hospitals affiliated with and providers employed by the HMO. Also, in some cases you must get a referral from your primary care doctor to see a specialist. Your total cost (after meeting your deductible) for each doctor's visit is usually limited to a co-payment and your doctor usually submits paperwork to the HMO for you. HMOs typically offer coverage for preventive care services.

Preferred Provider Organization (PPO)
This type of plan has a wider network of providers from which you may choose and there is usually a co-payment for each visit (after meeting your deductible). You may have the option to see out-of-network providers, but you will have to pay more than if you see a network provider. You may not need a referral from your primary care doctor to see a specialist if they are in-network. A PPO typically provides coverage for preventive care.

Point of Service Plan
This type of plan is the most flexible of all. It has provisions similar to the HMO, PPO, and Fee-for-Service plans. Much like an HMO, the lowest out-of-pocket costs come if you use specific participating providers. The next lowest out-of-pocket costs come from using listed providers, similar to a PPO. The highest out-of-pocket costs come from using providers that are not affiliated with the plan at all. The name says it all—the point (or place) where you receive the service influences your out-of-pocket cost.

Fee-for-Service Plan
Under a traditional Fee-for-Service (or indemnity) plan, you can go to any provider you choose and you don't have to get a referral to see specialists. However, these plans are often more expensive than other plans. Fee-for-Service plans usually pay only for medical costs related to illness and accident and not for preventive care. Unlike other types of plans, you may be required to pay for services up front and then submit the bill to the insurer for reimbursement.

Exclusive Provider Organization (EPO)
This plan generally operates like an HMO, but the providers are not employees of the EPO. An insurance company generally manages an EPO while an HMO is a business unto itself. For most insurance policies, you will have to pay 100% of your costs up to a pre-determined amount (or “deductible”) before the plan will pay any claims. Even after the deductible has been met, you may still have to pay a portion of the costs, often 20%, with the insurance company paying the remaining 80% until your “out of pocket maximum” has been met.

Health Accounts

Health Savings Account (HSA)
An HSA is an account that allows you to save money on a tax-free basis to pay for current health costs before your insurance deductible kicks in. It allows you to contribute to this account from your paycheck before taxes to save for future qualified medical costs. In order to have an HSA, you must be covered by a High Deductible Health Plan (HDHP). The advantages of having an HSA are that you earn interest on your savings. Similar to a retirement plan, unspent savings roll over to the next year, and both employees and employers can contribute to this account, which can stay with you if you change employers.

Health Reimbursement Arrangement (HRA)
An HRA is similar to an HSA in that they both allow you to pay for current health costs and save for future qualified costs on a tax-free basis. An HRA earns interest over time, and employers have the option to allow you to roll over unspent funds to the next year. However, unlike the HSA, only the employer can contribute to this account, not the employee, and it does not stay with you if you change employers. You should use your HSA or HRA to pay for all qualified services until you have reached the amount of the deductible or out-of-pocket maximum. Most HSA/HRA accounts have a checkbook or debit card that you use to pay for health costs. If you have health insurance through your employer, refer to your benefits plan summary or contact your employer's Human Resources department for details. If you purchase your own insurance, contact your insurance company for a summary of benefits.

COBRA (The Consolidated Omnibus Budget Reconciliation Act of 1985) is a federal law that serves two purposes. First, it can extend health care coverage for 18 months past the end of employment if you have had medical coverage with your employer. Second, it can help you qualify for a private health care policy. For example, if a person stays on COBRA until it runs out, they cannot be turned down for a private health care policy because there were no gaps in coverage. The person must start the private policy within 180 days from the date their COBRA runs out.

For more information visit COBRA (United States Department of Labor).

Each state has its own means of enrolling individuals and families in Medicaid and CHIP. To enroll your child in Medicaid or CHIP, go to your state site, or go to Insure Kids Now.

Once an individual or family is enrolled in Medicaid, it’s important to know that every provider does not accept Medicaid coverage. Finding a doctor or hospital that accepts Medicaid can sometimes be challenging, depending on your location. Most state Medicaid websites have searchable provider lists for enrollees. Another way to locate health care providers who accept Medicaid is to call the Member Services number on your Medicaid card and speak with a representative who has up-to-date lists of providers in your area.

Check your policy to make sure you understand what services are covered. Sometimes services that are connected to a certain diagnosis will be covered, and sometimes not. (For example, Autism Diagnosis and Treatment is not always a covered service.)

Some plans work with selected health care providers called a provider network. These providers are "in-network" and have a contract with your insurance company to accept a contracted rate for full payment of services. If you choose to get care from a provider who is not included in your plan’s network, you will likely pay a greater percentage or the full cost of the care. To find in-network providers, look at your current provider directory, call member services (on your insurance card) or go to your health insurance website and search.

Out-of-network providers have not agreed to any set rate with your insurance company. However, if you need to use an out-of-network provider, you should contact your insurance plan to see if they will pay a percentage of the cost. Emergencies (with no choice of the provider) are usually covered as long as you contact them as soon as possible to explain the care.

Out-of-pocket costs are those you must pay before your plan starts to pay. If you have met your out-of-pocket maximum, your plan will pay the rest of your costs in full. Depending on the type of plan, you may be required to pay:

• A deductible, which is a set dollar amount you will pay before your insurance begins to pay its percentage. You pay full price to the providers until you have reached that set dollar amount. After that, you will pay only co-insurance and co-payments.
• Co-insurance, which is your percentage after you have reached your deductible. For example, if you have 20% co-insurance, you will only pay 20% of in-network costs, and your insurance will pay the remaining 80%.
• A co-payment, which is a fixed dollar amount you pay for covered service at each visit or purchase of prescriptions. Sometimes your co-payments will count towards your out-of-pocket maximum, depending on your plan. Also, there may be a lower co-payment for generic medications.
• Out-of-pocket maximum is the most you will pay out-of-pocket in a benefit year for medical services. This amount includes your deductible, co-insurance, and sometimes co-payments. Once you have paid this amount, your insurance covers 100% of your in-network costs for the remainder of the benefit year.

Sometimes medications are covered under your health care plan or a prescription plan. If so, it is important to know which medications are covered and if there is a preferred list of medications covered by your policy. If so, when a provider prescribes a medication, ask them to make sure your insurance will cover it before writing the prescription. You can also ask if a generic version of the medication is available and if they can be prescribed for 90 days instead of 30, which may lower the co-payment.