To most people, health insurance is confusing. You know you need a policy, but you may not know the terms and fine print associated with modern health insurance. It’s overwhelming, to say the least. With all of the new lingo and jargon out there, it’s hard to stay up to date. Let’s dive into the key health insurance terms so you have a fighting chance.
Affordable Care Act
You may have heard of the Affordable Care Act, which is often referred to as the ACA. It is a healthcare reform signed into law back in March of 2010. The goal of the ACA is to ensure healthcare is affordable and accessible to everyone while offering tax credits to lower medical costs based on household size and income.
A copayment is the amount of money you pay for healthcare services after reaching your annual deductible. If you pay for a doctor’s visit, you’ll pay until you meet the deductible in full. Then, your insurance will kick in for the rest of the year. You then pay a small portion of the visit while the insurance policy covers the rest.
A dependent – usually a child or spouse – that you can claim as a “personal exemption tax deduction.” You can claim this individual on your tax return. With the Affordable Care Act, you likely qualify for premium tax credits to help you cover your claimed dependents.
You can generally have a dependent under the same health insurance policy as yourself. However, doing so often means an increas in your annual deductible.