Health Insurance
The term “health insurance” includes a broad range of coverages which protect individuals and groups from losses caused by poor health or accident. The available protection ranges from providing the insured with a hospital room to replacing his/her lost wages. The strong demand for individual protection against the costs of illnesses and accidents precipitated the development of group accident and health insurance in 1910, group hospital and surgical benefits in 1928, individual comprehensive major medical insurance in 1958, and the Medicare program in 1966. Today health insurance is provided through a wide variety of governmental and private organizations. The private sector includes both profit and nonprofit groups.
The significance of health insurance is illustrated by the fact that over 200 million individuals, or 88 percent of the civilian population of the United States, has some form of health protection. This insurance is provided by over 300 insuring organizations. Although there is a wide variety of health insurance coverages, they may be divided into two basic groups-medical care and income replacement.
Medical Care
Medical care coverages protect an individual against expenses incurred as the result of an accident or sickness: hospital room and board costs; nursing fees; physician, surgeon, and anesthetist fees and the costs of medicine and drugs. One may purchase protection against all or some of these expenses as there are many variations and combinations of coverages available.