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Health Insurance,
Actually Explained

No jargon, no sales pitch — just the terms and concepts you need to make sense of your options before you ever talk to an advisor.

The Glossary

Health insurance terms,
in plain English

Tap any term to expand it. These are general definitions — always confirm specific plan features against your actual policy documents.

What is a premium?
The amount you pay, usually monthly, to keep your health insurance plan active. This is separate from what you pay when you actually use care, like copays or deductibles.
What is a deductible?
The amount you pay out of pocket for covered care before your insurance starts paying its share. Some plans, including some private plans, offer low or $0 deductible structures — always confirm the specific deductible on any plan you're comparing.
What's the difference between a copay and coinsurance?
A copay is a fixed dollar amount you pay for a specific service, like $25 for a doctor visit. Coinsurance is a percentage of the cost you pay after your deductible is met, like 20% of a hospital bill.
What is an out-of-pocket maximum?
The most you'll have to pay for covered services in a plan year. Once you hit this number, your insurance covers 100% of covered costs for the rest of the year.
What's the difference between a PPO and an HMO?
A PPO (Preferred Provider Organization) typically lets you see any provider without a referral and offers some out-of-network coverage, usually for a higher premium. An HMO (Health Maintenance Organization) generally requires you to use a specific network and get referrals for specialists, often at a lower premium.
What is an ACA Marketplace plan?
A health plan sold through the government's Affordable Care Act marketplace. These plans use modified community rating, meaning pricing doesn't vary based on your individual health status, and many buyers qualify for premium tax credits (subsidies) that lower the monthly cost.
What is a private (medically-underwritten) health plan?
A health plan sold directly by a carrier outside the ACA marketplace, priced using medical underwriting — meaning your individual health profile factors into the price. This is a different pricing mechanism than marketplace community rating, not a loophole; it can be a better fit for healthy applicants.
What is community rating?
A pricing rule that requires ACA-compliant marketplace plans to charge the same premium to everyone in a given area and age band, regardless of health status. It protects people with health conditions from higher prices, and is a key reason marketplace and private-plan pricing can differ for healthy applicants.
What is a Special Enrollment Period (SEP)?
A window outside of the annual Open Enrollment Period when you can enroll in or change health coverage, triggered by a qualifying life event such as losing a job, getting married, or having a baby.
What is Open Enrollment?
The annual window during which anyone can enroll in or change an ACA marketplace health plan without needing a qualifying life event. Dates vary by state.
What is a premium tax credit (subsidy)?
A federal subsidy that lowers your monthly ACA marketplace premium based on household income and size. Eligibility and amount vary — a licensed advisor or the marketplace can calculate your specific figure.
Is health insurance tax-deductible if I'm self-employed?
Self-employed individuals can generally deduct health insurance premiums from their federal taxable income, whether the plan is private or ACA marketplace. This is general tax information, not tax advice — consult a tax professional about your specific situation.
Good To Know

A few concepts worth understanding
before you compare plans

General market information, not a promise about any specific plan — always verify features against the actual policy.

Community rating vs. medical underwriting

These are two different, both legitimate, pricing mechanisms. Community rating (used by ACA marketplace plans) charges everyone in a pool the same rate regardless of health. Medical underwriting (used by private plans) prices based on individual health profile. Neither is a scam — it's about which mechanism fits your situation.

Deductible structures vary widely

Some private plans on the market offer low-to-$0 deductible structures alongside broader networks. This is a real plan-shape option worth asking about — but it's plan-specific, not universal, so confirm the exact deductible and out-of-pocket max on any option you're considering.

Telehealth is common, not universal

Many private plans on the market now include telehealth access as a standard feature, letting you connect with a provider remotely for many routine needs. Availability and scope vary by plan, so confirm what's included before assuming.

Self-employed? Premiums are often deductible

Health insurance premiums are generally deductible from federal taxable income for self-employed individuals — a standard federal provision that can apply whether you're on a private plan or an ACA marketplace plan. This is general tax information; talk to a tax professional about your specific situation.

Guides By Situation

Not everyone's situation
looks like the next person's

Deeper dives for people whose work doesn't look like a 9-to-5 in one zip code.

Coverage By State

What private PPO coverage
looks like where you live

Each state handles the ACA marketplace and Medicaid a little differently — here's how that shapes your options.

Still Have Questions?

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