What Does Private Health Insurance Cover?

What Does Private Health Insurance Cover?

A private health insurance plan is one offered by a private provider rather than one provided by the government. Private health insurance currently covers nearly half of the U.S. population.

A Kaiser Family Foundation report states that about half of Americans (155 million) have private health insurance through their employers. Another 6% (approximately 18 million in 2020) of Americans are acquiring private insurance from the individual/family health insurance market on or off the marketplace.

Like most Americans, you probably have private health insurance to cover your medical bills and help pay some of your healthcare costs. But do you know what your plan covers? Most people don’t, but they should care because it can save them thousands of dollars in unnecessary out-of-pocket costs every year, whether they have insurance through their job or bought it directly from an insurer.

Private health insurance policies are divided into hospital, general treatment, and ambulance coverage. Depending on your state, ambulance coverage might be available separately, combined with other policies, or even covered by your state’s government. Read on to learn more about what private health insurance covers.

Inpatient and Mental Health Services

Some private health insurance plans, including hospital stays and surgeries, cover inpatient services. Some also offer coverage for mental health care. Inpatient services are often offered at a lower cost than the same service outside the hospital.

This is because hospitals often have different pricing schemes for inpatients, such as room and board charges, that don’t take into account all of the costs involved in providing care. When it comes to mental health care, some plans may only cover this service when it’s provided by a psychiatrist or other licensed provider who is not affiliated with the hospital or clinic where they’re receiving treatment.

Outpatient Services

If you have private health insurance, your coverage for outpatient services is typically limited to doctor visits, diagnostic tests, lab tests, medications, and hospitalization. However, there are some exceptions.

For example, if your doctor recommends that you need rehabilitation therapy following a hospitalization due to an accident or injury, then your private health insurance might cover it and other related expenses, such as transportation to rehab sessions.

Also, if outpatient services are deemed medically necessary by your insurance provider (such as visiting a psychologist), they could be covered depending on the plan type (HMO or PPO).

Preventive Services

The typical health insurance plan will cover preventive services such as dental care, eye care, physicals, prescriptions, and laboratory tests. Even with a high deductible plan, you will receive low co-pays for these preventive services.

A dental cleaning is usually covered at 100%. Dental fillings are typically covered at 80%, and major dental work such as crowns or bridges may be covered at 70%. When it comes to your eyes, one eye exam every year is typically covered by most plans.

Some plans also include an annual contact lens exam. Prescription drugs are also typically covered by health insurance. If you have a high-deductible plan, you may receive prescription coverage only after meeting your deductible.