Understanding the basics of a health insurance policy can help you navigate health care costs. Here’s a quick breakdown of some key terms:
- Preventive services: These are services that are often fully covered at no cost to you, such as an annual visit with your primary care provider or vaccinations.
- Deductible: The deductible is the amount you pay for health care services before your insurance starts contributing. For example, if you have a $1,000 deductible, you’ll pay that amount first for covered services.
- Out-of-pocket maximum: This is the most you will pay in a year for covered medical expenses. After reaching this limit, your insurance covers 100 percent of additional costs. For example, if your maximum is $5,000, then once you’ve spent this amount, your insurance picks up the full cost of additional covered services.
- Coinsurance: Coinsurance is the percentage of a medical bill that you’re responsible for after meeting your deductible. For example, if you have a 20 percent coinsurance, then you would pay $20 of a $100 bill.
- Copays: A copay is a fixed amount you pay for certain services, such as doctor’s visits or prescriptions. For instance, you might pay a $20 copay for a visit, regardless of the total cost of the service.
The amount you pay also will be dependent on whether the service is provided by an in-network provider – a doctor or facility that accepts your health insurance. Typically, costs are lower when care is provided in-network.
It is important to understand your health insurance policy to best manage your health care expenses and avoid any surprises along the way. For further information, please reach out to the employee benefits team at Schauer Group.
