Health insurance: An overview

Health insurance helps you pay your day-to-day healthcare expenses: prescription drugs, fees of specialists you consult (physiotherapists, chiropractors, acupuncturists, etc.), transportation by ambulance, etc.

Not all costs are necessarily reimbursed by your insurance. It depends on your contract.

Insight

Don’t have group insurance?

Most health insurance coverage is part of a group insurance plan

If you don’t have access to a group insurance plan, you can buy individual health insurance.

End of the insight

Understanding the premium and the deductible

To understand how health insurance works, you need to understand what is meant by “premium” and “deductible.”

Premium

The insurance premium is the amount you pay to qualify for insurance coverage under the policy. In the case of group insurance, this amount is deducted directly from your pay.  

Deductible

The deductible is the amount you must pay before you can claim a reimbursement from your insurer.

Let’s say, for example, that your prescriptions cost you $250 and your deductible is $50. Your insurer will calculate the amount of your reimbursement on $200. If it reimburses 80% of the cost, the calculation will be $200 x 80% = $160. Therefore, your reimbursement will be $160.

The deductible is payable only once a year.

Other types of health insurance

Health insurance covers the costs of day-to-day health problems. There are other types of health insurance to meet specific needs. Here is an overview:

Dental insurance

Dental insurance applies only to care provided by a dentist. It reimburses the cost of routine dental care such as cleaning and dental exams, as well as repairs such as fillings and root canals. Dental insurance is often part of a group insurance plan.

Other types of group plans

"A la carte" or "custom" plans

This type of plan generally offers flexibility in choice of coverage. You can select and modify the coverage based on what has been selected by your employer. For example, you could opt for coverage of orthodontist expenses if you have teenaged children. A few years later, you could select coverage for vision. 

Normally, you can modify your choice one a year or after a life-changing event such as a birth, marriage or death.

Your insurance premium will change based on the coverage you’ve chosen: The more you’re insured, the higher your premium.

Health accounts

A health account is an amount that an employer sets aside to reimburse its employees’ healthcare costs. For example, if your employer gives you a $500 health account, you can be reimbursed for any kind of healthcare expense up to a maximum of $500. After that, you must pay all costs out of your own pocket.

Administrative Services Only (ASO) plans

There is another type of coverage for employees: the uninsured employee benefit plan, also known as an Administrative Services Only (ASO) plan. In this case, your employer assumes the costs claimed by its employees. An insurance company is still required to administer the plan however, to avoid conflicts of interest.

Critical illness insurance

Critical illness insurance provides you with a lump-sum benefit when you have been diagnosed with a specific illness, such as cancer. To receive this amount, the illness must be listed as a critical illness in your insurance contract.

Generally, you must survive for 30 days after the diagnosis in order to be entitled to the benefit.

You can use the lump-sum amount you receive from the insurer as you see fit.

You do not need to present any invoices.

For more information, read the page on critical illness insurance.

Long-term care insurance

This insurance covers you if you become seriously ill and can no longer take care of yourself. This insurance is useful if you develop a chronic illness, are suffering from Alzheimer or have a serious accident. The amounts reimbursed are generally used to pay long-term care expenses in specialized care centres. They can also be used to pay for in-home care.

Right to exemption

You can refuse to enrol in or withdraw from a group health insurance plan conditional on proof of coverage under a similar plan. For example, if you are already covered by your spouse's group health insurance plan, you could then decline to enrol in the plan offered to you.