What is health insurance?

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How does health insurance work?

Health insurance can be complicated. A simple way to understand health insurance is to think of it like a gym membership. Each month, you pay a fee to get different benefits. Your monthly gym membership fee might give you access to workout equipment, exercise classes, or a pool. Your monthly health insurance fee (also called a premium), allows your insurance company to:

Pay for a part of your medical bills,
Provide free preventive care services like cancer screenings or yearly check-ups,
And protect you from unexpected or expensive medical costs

Some gym memberships offer freebies to help you stay healthy (think: online support communities or healthy recipes). For a higher monthly fee, gyms may offer extra benefits like personal training, weight loss programs, or massage therapy. Health insurance is the same.

Many health insurance plans give members benefits like discounts or wellness programs where you can earn rewards for healthy habits. But for a higher monthly fee, you can also choose to access more benefits. These benefits might include help paying for mental health services or coverage that lets you pay a lower part of your medical bill.

Why do I need health insurance?

#1. Financial Protection One of the most important reasons to get health insurance is financial protection. Without health insurance, getting health care can be very expensive. Even healthy people should have insurance because it helps protect them from unexpected medical costs.

Here’s an example. Maria is a healthy mom who is active and rarely gets sick. One day, Maria gets a terrible stomachache and goes to the emergency room. The doctor there tells her she needs to have surgery to remove her appendix. Without insurance, Maria would be responsible to pay for the entire hospital bill (the average cost to remove an appendix is about $33,000). The benefit of having insurance is that it sets a limit on how much you can spend on health care in a year. Once you hit that limit, your insurance plan will help you pay for the rest of your medical bills.

#2. Staying Healthy for a Lower Cost Health insurance also helps you get the services you need to stay healthy. Vaccines, depression assessments, birth control counseling, cancer screenings, developmental check-ups for children, and many more services are all free to people with health insurance. Some insurance plans even give you money back for getting important preventive care services like an annual flu shot.

What is health insurance videos

Getting health insurance is one of the most important steps you can take for your financial, physical, and mental health. If you have trouble paying for health insurance, help is available in Utah through takecareutah.org or at medicaid.utah.gov.

About University of Utah Health Plans:

Like a great pair of jeans, your health plan should fit you just right. At University of Utah Health Plans, we understand there is no one-size-fits-all approach for your health benefits. That’s why we’ve created a variety of options to customize your plan.