Final answer:
Under a health insurance policy, benefits paid directly to the insured are provided on a reimbursement basis, where the insured gets paid back after paying for medical expenses themselves.
Step-by-step explanation:
When benefits are paid directly to the insured under a health insurance policy, the policy provides benefits on a reimbursement basis. This means that the insured pays for their medical expenses out-of-pocket and then submits a claim to the insurance company to get paid back for those expenses. While other types of health insurance arrangements exist, such as health maintenance organizations (HMOs) which provide care paid through fixed amounts per person, reimbursement-based coverage relies on the individual receiving the service and then being reimbursed by their insurer.