What does Reset Network Settings do?

What does the "Reset Network Settings" option do? I found this suggestion under the "calls connection issues" topic and all it says is that it will "clear current cellular and Wi-Fi network settings, saved networks, Wi-Fi passwords and VPN settings" but doesn't go into any details of what happens next.

Will the phone just automatically reassign the proper settings or will I have a dead phone?

I'm on Verizon and have iPhone 4S, OS 5.1

The reason I went looking is because when I first got the iPhone in Jan 2012, I would have issues with calls going straight to voicemail even though my phone was on and showing strong reception. The phone wouldn't ring or anything and then I wouldn't get my VM messages until hours later. This would also happen with text messages.

I didn't even know there was an issue, nothing on the phone indicated anything like missed calls or bad/no connection, and would only find out when friends told me or I'd listen to the VM. And it didn't happen all the time just every now and again.

So I had to call Verizon several times and on the last call they refreshed my network line, so I didn't have to do a phone wipe/reset, and that seemed to do the trick. But just today I discovered that now calls are just ringing, but not ringing on my handset. So I have to dial *832 to test the line, which passes, and then everything is fine again: calls come through, and all texts that were held in purgatory while this anomaly happens, come through immediately.

So I'm wondering if resetting the network will solve my issue. Is anyone experiencing the same? 😮

BTW, yes, I've checked the most obvious thing, and no, I do not have my ringer silenced, off, or have the switch on red.