Financial Jargon Simplified: Health Insurance

Financial jargon simplified: health insurance

Doing some homework to understand important jargon can help you navigate insurance with confidence.

Financial jargon can be confusing to navigate, for both the ‘new-to-managing-my-finances', and even those who are more experienced at it. If you've ever felt like you need a healthy dose of ‘just the facts', you're in luck.

It's time to feel empowered to own your financial conversations. Brushing up on these terms can help you make more informed, confident decisions in your financial life - ultimately getting you to your goals faster and smarter.

Insurance is complicated to begin with, but health insurance can feel especially complex. Whether you're in the market for health insurance, or find yourself having to use it, knowing the basics of how health insurance works can help to understand what you've got to pay, and why.

It's no secret that healthcare can be expensive. On top of that, your monthly health insurance costs can vary depending on the type of plan you choose. The health insurance simplified infographic below can help shed some light on common key words and phrases to understand as you choose the healthcare plan that's best for you, or better understand the coverage you already have.

Read the full description of the infographic

Jargon Simplified: Health Insurance

Aspects of Any Health Insurance Plan

Premium: Cost of your insurance.

Deductible: Amount you pay before the insurer pays any expenses. The higher the deductible, the lower your premiums will generally be.

Copayment: Amount you pay every time you visit the doctor.

Coinsurance: Percentage you are responsible for after you pay the whole deductible amount.

Maximum Out of Pocket: The maximum amount you will pay annually, no matter how high the bills are, before an insurer pays all remaining bills.

Most Common Plans to Choose from

PPO: (preferred provider organization): Uses a network of doctors to provide lower costs, but you can also choose out-of-network doctors at a higher cost.

HMO: (health maintenance organization): Focuses on preventative care and assigns a primary care physician as your “gatekeeper”.

Other Benefits that May be Available in Your Plan

Flexible Spending Account: (FSA): Account you contribute to tax free to pay for medical expenses. If you don’t use money you contribute for the year, you lose it.

Health Savings Account: (HSA): Account you contribute to tax free to pay for medical expenses, but is only available for high deductible plans.

What Now?

While open enrollment for many major medical plans is typically November through December, if certain changes in your life happen (like getting married or moving) you can make adjustments outside of the designated enrollment period.

To get ahead of the game today, take a look at your current healthcare plan to make sure you're confident with your coverage and understand your plan. And, check out www.healthcare.gov for even more specific healthcare plan information.

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