Healthcare costs rise everyday, and health insurance is a must if an individual wants to make sure that they can pay for their medical bills to keep themselves healthy not only physically, but also financially. Unfortunately, most people don’t understand even the basics when it comes to their own medical policies. Here are 5 tips that I feel are the most important that everyone should understand when it comes to their health insurance.
Deductible
The is a word that goes hand in hand with insurance. Deductibles are the amount you or your family as a whole must meet before your insurance will pay for any of your benefits. There are many different forms of deductibles, and it depends on what the policy or your employer is offering. With the sluggish economy, to cut costs, employers are now offering many high-deductible medical plans that put more of their employees medical costs in their hands. To help offset these high deductible plans, employers are also offering more flexible spending and health savings accounts. The only exception to meeting the deductible is if the plan offers a straight copay for a simple office, urgent care, or emergency room visit.
Preventative Care
I heard this so many times when taking phone calls for member service, “I understand I already had my physical for the year, but I’m going for my office visits to prevent this from happening to me. That’s what my preventative benefits mean right?”. Sorry, that’s not how your preventative benefit works. Most insurance policies cover an annual visit to your doctor so you can get a check up. This meaning your a perfectly health individual, visiting your primary care doctor so you can get your blood work done, your weight documented and have your doctor tell you that you need to eat more fruits and vegetables. Most people take the word prevention too seriously, and expect that every office visit that is “preventing” them from getting more sick (cancer, heart disease, ect.) should be covered 100%. This is not the case, and expect to pay the cost of seeing your doctor often, whether that be copay or your coinsurance.
Co-insurance
This is a term used by most insurance companies to describe the percentage the patient or member is responsible for on their doctor bills. You may also refer to this as a number like ” my plan pays 80/20, 90/10″. This person is indicating that their plan pays 80% or 90% of your medical costs, leaving you with the difference. This difference is your co-insurance, and yes you do have to pay that bill. The confusion may also lie in the fact people believe that once their deductible is met, they don’t have any more responsibility for the healthcare costs. If your plan is set up with a co-insurance, this is not the case, you are still responsible for paying your co-insurance percentage after your deductible is met.
Out of Pocket Maximum
This is fairly self explanatory, but is still very misunderstood. This is the amount per year, that an individual must pay before you insurance starts paying 100% of your benefits. This can be applied per individual, but may include a family out of pocket maximum that can be met if costs from several family members are attributed.
In Network vs Out of Network
This is one of the most important aspect of your benefits that must be understood. Every insurance company has a network of doctors that they utilize to offer discounts to their respective members. Everyone whose going to see a doctor, should always check with their insurance to ensure they are going to an in-network provider. You will receive higher benefits, and in many cases your insurance will not pay for any services taken from out of network providers. This can be a very scary proposition, when thinking your covered for a service, is no longer covered at your in network level and is the members responsibility completely. Out of network providers will also charge their full amount, having no contract with the insurance, network they use, to take a discount on their services. Always check that your hospital or provider is part of the network to avoid an unexpected medical bill.
These are five things that everyone should understand when choosing their healthcare benefits, and are most commonly misunderstood. Other things that should certainly factor into choosing your policy for the upcoming year would include premium costs and additional costs for dental and vision care, as well as the ability to cover dependents and spouses/domestic partners and other things that you personally deem important.