What Is Health Insurance?


Quick Answer

Health insurance provides financial coverage to individuals for medical situations; people subscribe to a health insurance policy for a fee, then receive coverage when necessary for routine office visits, hospital stays and other medical events. Health insurance comes in several packages, as some individuals and families subscribe to health insurance, while other insurance packages come from businesses and employers. Although policyholders pay a fee for insurance, they often avoid incurring exorbitant fees, and medical expenses rank among the leading causes of bankruptcy, say experts at Medical Mutual.

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What Is Health Insurance?
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Full Answer

In the United States, citizens must have health care coverage. Health care plans do require payment, but offer significant benefits. These plans offer care immediately upon enrollment, which safeguards against accidents and emergencies. They also help people stay organized and keep records of past and future payments. Upon subscription, health care plans let patients access certain health networks. These networks contain participating physicians and medical professionals who offer better prices to insurance holders than to people with out-of-network plans.

In addition to protecting policyholders during the event of an unforeseen medical situation, insurance plans let patients receive preventative care. This includes vaccines, regular doctor's visits and diagnostic tests. Health insurance, although expensive, ultimately saves money. People without health care must pay penalty fees, as stated by Healthcare.gov.

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