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    Health Care Reform:

    Health Insurance & Affordable Care Act

    Changing Health Care: Terms You Need to Know

    In our changing world of health care and health insurance, it's more important than ever to understand the basic terms of health insurance in order to get the best possible care at the best possible price.

    Here are key terms you need to know.


    COBRA is the name of a law that lets you keep your health insurance when you've lost your job or if you get divorced and had insurance through your former spouse's employer. Under COBRA, you can keep the insurance that you had under your old job for 18-36 months.

    You should be aware that if you use COBRA, your insurance will likely be more expensive than when you were employed. That's because you need to pay the share of the premium that your old employer used to pay.


    If you have health insurance, a co-payment is a fixed fee that you pay for a medical service that is covered by your insurance company. For example, your insurance may require that you pay $15 each time you visit your doctor. The insurance company pays for the rest of the bill.


    A deductible is a flat amount that you have to pay for health care services before your insurance plan begins to pay for them.

    For example, if your deductible is $1,000 per year, your insurance company won't pay for anything until you've spent $1,000 dollars of your own money for medical bills.

    Flexible Spending Account (FSA)

    An FSA is a special tax arrangement that you set up with your employer. An FSA allows you to set aside money out of your paycheck before taxes so you don't have to pay tax on it. You can use this money to pay for medical expenses that are not covered by your health insurance plan.

    For example, you may use FSA money to pay for:

    • Co-payments or deductibles
    • Drugs or medical devices not covered by insurance plans

    But be careful. FSA money is "use it or lose it." In most cases, you will lose the money if you don't use the FSA funds within the year.

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