Medical insurance, also known as health insurance, is a type of insurance that covers some or all of the costs of medical expenses incurred by an individual. It is a contract between an insurance company and a consumer, where the company agrees to pay for some or all of the insured persons healthcare costs in return for payment of a monthly premium. The policyholder pays a premium to the insurance company, and in exchange, the insurance company agrees to pay for some or all of the policyholders medical expenses, depending on the details of the policy itself.
Medical insurance policies can be purchased as either "Group" or "Individual/Family" policies. Group policies are typically offered by employers or associations, while individual/family policies are purchased outside of an employer or association and are issued to the individual who applies for it and their family.
In the United States, health insurance is regulated by state and federal laws, and there are several different types of health insurance plans available. Some of the most common types of health insurance plans include:
- Medicare: A federal health insurance plan that provides coverage to older, disabled, and low-income people.
- Medicaid: A federal and state program that provides health insurance to low-income individuals and families.
- Childrens Health Insurance Program (CHIP): A federal program that provides health insurance to children in families that earn too much to qualify for Medicaid but cannot afford private insurance.
- Private Insurance: Health insurance plans that are purchased by individuals or provided by employers.
Having medical insurance provides a safety net in case an individual ends up with a serious injury or illness. It helps with smaller expenses in the form of free preventive care and copays for things like office visits and prescription drugs. Medical insurance policies vary in terms of what they cover, so it is important to read the policy details carefully to understand what is and is not covered.
