Don't wait until a medical emergency or illness occurs before you understand your health insurance policy. Although trying to read your policy may be as interesting as watching paint dry and also confusing, it is important to at least gain enough information about your policy to understand the basic policy terms and what it covers.
Sign Up for an Insurance Policy
When you sign up for an insurance policy, you are agreeing to follow the rules of the plan. Most likely you were given a benefits booklet that you filed away or no longer have a clue where it is located. The benefit booklet is where you will need to look to understand your health insurance policy. If it is nowhere to be found, call the customer service number on your identification card. Often times they will be able to direct you to where it can be located online.
Basic Understanding of the Terms
After you have a basic understanding of the terms, the next important thing about your plan is finding out whether there is a waiting period. A waiting period is a specific period of time when you are not covered by your insurance. Some plans have a 30-day wait, others 60 or 90, and some are effective immediately. If you go to a doctor before the waiting period has been met, you will be responsible for the full amount of the medical bill.
Pre-Existing Condition Clause
In addition to a possible waiting period, some plans may have a pre-existing condition clause. A pre-existing condition is a medical condition that is excluded from coverage by an insurance company because the condition was believed to exist prior to the individual obtaining a policy from the particular insurance company.
Medical Benefits are Covered by Your Insurance Plan
Your policy will contain a section titled covered medical services that describes what conditions are covered by your plan and the amount payable by the insurance company vs. the amount, you, the policyholder is responsible to pay.
There will also be a section called exclusions or medical limitation and exclusions which outlines conditions that are not covered by your insurance plan. It is very important to pay attention to this list because you will be responsible for the entire bill if you are treated for a condition your insurance does not cover.