Insurance and assurance are two closely related yet distinct terminologies in the finance sector.
Often misinterpreted to be the same, each concept varies quite differently in terms of characteristics.
To demystify the paradox let us first look at the general interpretation of each vocabulary.
Insurance is a risk cover tool that indemnifies the insured in the event of accidents or unfortunate incidents.
The contract works through a trade of premium payments in exchange for security.
It often places a demand on the insurance carrier to offset certain financial liabilities that would otherwise be disadvantageous to the beneficiary or nominees.
Fundamentally, the basis of an insurance plan is to offer coverage for an anticipated or foreseen event.
On the other hand, an assurance cover is one that broadens its scope into a wider umbrella.
Although it works under the same principle of predetermined monetary amounts, the insured is compensated against those events whose happening is certain and unquestionable.
For example, death is regarded as an event that will happen either sooner or later.
When a type of financial cover is introduced to offer reimbursement upon demise, the policy qualifies to be an assurance.
In a nutshell, an insurance contract compensates for low probability occasions whereas an assurance compensates for high probability occurrences.
Narrowing it down into the health industry, assurance plans work towards an advanced model of care that is all-round.
This policy integrates several health care components ranging from disease prevention, optimum illness care, to endorsement of better health.
It is fueled by the need to provide a holistic health system that illuminates all the dimensions of critical care services.
Judging by the provisions of an insurance agreement, its concept comes up nothing short of a mere illness response.
At the core, a health plan is nothing more than a process of treatments, claims, and payments.
In the best-case scenario, the insured only walks away with monetary settlements but little to no benefits as regards healthy living.
Part of the wide spectrum that an assurance policy delves into, are complementary sectors that in one way or the other play a significant role in the realization of a healthy society.
These modules include; water access, sanitation, agriculture and food supply, environmental climate, drug accessibility, infrastructural systems, and the likes.
All the above are intertwined in the bearing forth of a healthy status quo.
A nation without a stable food security plan or poor transportation systems drives up its citizens’ liability to all kinds of illnesses and malnutrition complications.
Environmental challenges curtail the productivity level thus leading to starvation. Inaccessibility of medical facilities compromises on the quality of care.
This is to mean that the functionality of these programs can either erode or enable health care.
In their absence, the feasibility of a medically fit population is rather slim.
Health assurance programs are often driven through a combination of several financing mechanisms that supersede the bare minimum cost coverage offered by insurance policies.
Apart from private carriers, its health care design equally relies on government-sponsored initiatives.
These may take the form of; free access to medical facilities- cum- services, government-funded social welfare programs, employer-provided health insurance for additional services, and/ or a private insurance extension for those willing and with the capacity to purchase such services.
Let us take a look at each for a better understanding.
Free provision of medical care accommodates those unable to financially meet their health expenses cost.
The program provides similar coverage to that of the private insured domain.
Beneficiaries earn free access to medication supplies as well as professional check-ups that are oftentimes expensive to the larger majority.
Persons without an insurance policy cover are undoubtedly not legible to any medical help whatsoever without digging into their pockets.
A modern-day example of a state health assurance is the Pennsylvania Medicare that spread its wings to an average of 11 million people from 23 different states within the nation.
This initiative came as an emergency aid program that offered quality health care options to all.
A social welfare program is simply a government subsidy for low-income families and individuals.
Resources are ultimately sourced from the federal government but the programs themselves are administered by local state management.
Common examples of social programs are inclusive of basic services such as cash assistance, food and house grants, education assistance, child care assistance et cetera.
In this case medical aids such as vaccinations, ARV (antiretroviral) subsidies are offered with an intention of greater patient protection and preventive benefits.
Employer-sponsored plans can be argued as a competitive recruitment strategy that grants small- scale employers an advantageous edge, none the less, it works as a subtle kind of health assurance.
Many employees tend to gravitate towards bigger organizations that come with a health package because the benefits largely cut down on expenses.
The program may not ultimately cover for all health care expenditures but it does give workers access to employer-funded incentives.
To promote organizational medical plans, the US government enacted a Small Business Health Care Tax Credit in 2010.
Initially, the credit spun up to 35% cover of an employer’s health care premiums; with a possible extension of up to 40% by 2014.
To qualify for the tax advantage, businesses were expected to meet a requirement of at least 25 full-time employees or an equivalent of 50 half- time workers.
The minimum standard pay wage allowed was not to drop below the 50,000-dollar mark per year while the employers paid at least half of their staff’s medical coverage.
In comparison to a regular insurance agreement, certain benefits highlighted above do not apply.
Its manifesto is quite rigid and strictly limited to individuals who are financially able to afford the provided services.
A health assurance on the other hand is a broader service platform with advanced flexibilities.
Conclusion
A health assurance incorporates aspects of health insurance but is not limited to the same.
Although a strong continuum exists between the two, the former provides an expanded range of Medicare options otherwise unavailable in the traditional insurance contracts.
This translates to better healthcare in general and detailed patient care.