What is Health Insurance?

What is Health Insurance?
La estudiante de medicina de USC, Hanna Segal, se prepara para tomar la presión del paciente George Israel en el Center for Community Health en el centro de Los Angeles. | Foto: GETTY IMAGES

Health insurance covers the medical and surgical expenses of the policy-holder through several different plans.

Some countries, like Canada and Spain, have universal health coverage. This means that every citizen of these countries receives medical care through a single system that is generally managed by the State. We don't have this type of universal system in the United States.

Here we obtain health care coverage in a variety of ways. In general, health insurance is included in the benefits package offered by an employer. Nearly 157.5 million people receive medical coverage through their work.

Other people get health insurance by registering in public health programs. This includes the 70 million people who receive Medicaid (the federal health program managed by states for low-income individuals), and nearly 44 million who are registered for Medicare (which provides health care coverage for seniors over 65 and other adults with disabilities).

Other programs include CHIP, which provides medical care for nearly 98 million children, or the health initiative for veterans called VA Health.

Purchasing a Private Plan

Around 22 million people in the United States, including young adults over 26 years old who are just joining the labor market, and others who work independently or don’t have fixed employment, are required to purchase coverage individually through insurance marketplaces.

With all these options, there are still 27 million people who don’t have health insurance.

Depending on the type of coverage you have, a healthcare plan might pay for all your expenses, or you may have to cover some of these out-of-pocket. There are other plans where you pay up front, and then you are reimbursed for a portion of these through your plan.

Here you will find information on dozens of medical plans. Make sure you do your research, as it’s important to choose the plan that best fits you and your family’s medical needs.

In March of 2010, the Affordable Health Care Act (ACA), or Obamacare as it is commonly referred to, went into effect. With it, access to Medicaid was expanded to include more people and to provide coverage for preexisting conditions, among other changes.

ACA established mandatory individual health insurance coverage. This means that, with some exceptions, everyone in the US is required to have health insurance or pay a fine. However, this penalty was removed from the legislation and starting in 2019 is no longer applicable in most of the country.

You should check to see what your state's specific regulations are for mandatory health insurance, as new state mandates were implemented in places like Massachusetts and New Jersey, for example.

Source: HHS, CMS

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