Private VS Public Health Insurance
By Jason Province
We live in a time where health insurance is at the forefront of many household discussions and political debates. People are often confused or uneducated about the different types of health insurance out there and come to conclusions about certain health programs without the proper information. So we are going to break down the two types of Health Insurance you can receive in the United States.
Private health insurance is what a vast majority of US citizens use. This is where you pay a fee/premium to receive coverage for illnesses and injuries. Private health insurance agencies are for-profit organizations that can be accessed through the Marketplace or through your employer. There are three basic types of private insurance that available that fall under the managed care title. Managed care is where your insurance plans work with certain health care providers, which are in the insurance plan network so that the costs are lower. There are Health Maintenance Organizations (HMOs), Preferred Provider Organizations (PPOs), and Point of Service.
- Health Maintenance Organizations will only pay for medical care that is within their approved medical network. So to receive care that is covered, you will need to use their approved doctors and specialists. These plans are usually cheaper than PPOs.
- Preferred Provider Organizations will cover some medical costs outside of their network, but to receive full coverage you will have to stay within the medical network.
- Point of Service plans are the most flexible of the three managed care plans. When getting medical care with a Point of Service plan, you choose between an HMO and PPO each time you receive service. This plan allows you to choose between more doctors and hospitals for care than HMOs and PPOs.
The last form of private insurance available is called Indemnity (fee-for-service). This is not a managed care plan like the plans previously mentioned above. There are no restrictions to which doctors or hospitals you choose to use. In this plan your healthcare provider gets paid a fee whenever they provide a service covered in the plan. You will have out of pocket expenses and they can be expensive.
Public health insurance is often misunderstood and currently a heated topic amongst Americans. Compared to private insurance, the main difference between the two is who’s paying the premiums. The two main forms of public health insurance are Medicare and Medicaid. The government provides both forms of insurance but do have some differences that set them apart.
Medicare is provided for people with disabilities, end-stage diseases, or for those over the age of 65. Medicare is made up of 4 parts. These parts are parts A, B, C, and D. Part A covers home health care, nursing homes, and hospital care. Part B is more basic and covers things like preventive care and doctor consultations. Part C, which is run by private health care agencies, often includes parts A and B and can include prescription drug coverage. Part D covers prescription drug coverage and is covered by private health insurance agencies as well.
Medicaid State government provides Medicaid by combining resources from both federal and state funds. Medicaid is designed to accommodate lower income families and individuals. Unlike Medicare, Medicaid has a larger list of things that determine your eligibility. The state will look at a number of factors, including but not restricted to family size, income, immigration status, disabilities, pregnancy, and health conditions. The state determines the guidelines for each of these areas of eligibility.
The information provided in this blog and more can be found in many different resources but a few are: http://www.webmd.com/health-insurance/tc/understanding-health-insurance-types-of-health-insurance, and http://insureme.us/public-vs-private-health-care/