Health insurance is a type of insurance whereby the insurer pays the
medical costs of the insured if the insured becomes sick due to covered
causes, or due to accidents. The insurer may be a private organization
or a government agency .
In the United States for example , government-funded Medicare programs
help to insure the elderly and end stage renal disease patients. Some
health care economists assert that these programs have had the
unintended consequence of distorting the price of medical procedures. As
a result, the Health Care Financing Administration has set up a list of
procedures and corresponding prices under the Resource-Based Relative
The Census Bureau broadly classifies health insurance coverage as either
Private (non-government) coverage or Government-sponsored coverage.
Private Health Insurance
Private health insurance is coverage by a health plan provided through
an employer or union or purchased by an individual from a private health
Employment-based health insurance is coverage offered through one’s own
employment or a relative’s. It may be offered by an employer or by a
Direct-purchase health insurance is coverage though a plan purchased by
an individual from a private company.
Government Health Insurance
Government health insurance includes plans funded by governments as the
federal, state, or local level. The major categories of government
health insurance are medicare, medicaid, the State Children’s Health
Insurance Program (SCHIP), military health care, state plans, and the
Indian Health Service.
Medicare is the Federal program which helps pay health care costs for
people 65 and older and for certain people under 65 with long-term
Medicaid is a program administered at the state level, which provides
medical assistance to the needy. Families with dependent children, the
aged, blind, and disabled who are in financial need are eligible for
Medicaid. It may be known by different names in different states.
SCHIP, the State Children’s Health Insurance Program, is a program
administered at the state level, providing health care to low-income
children whose parents do not qualify for Medicaid. SCHIP may be known
by different names in different states