Do you think you would be able to explain what a health insurance premium is if your child asked you? Would you be able to explain coinsurance? Do you know how much health insurance costs?
Most American’s that have health insurance are pretty confident that they would be able to explain these terms and have a good understanding of most insurance terms, according to the journal Health Affairs. The same journal says that less than a quarter of Americans feel the same way.
Millions of new Americans are getting health insurance, because of the Affordable Care Act (otherwise known as Obamacare). Many new options are also being created for people who are already insured. If you are confused about insurance concepts, you might find it hard to make the right choice when it comes to your coverage.
It is widely expected that the majority of Americans don’t know much about health insurance because they haven’t needed to.
If you want to educate yourself and now is the time, here are a few things you should know about health insurance.
Health Insurance has a lot more to it than your monthly payment or premium. That does not tell the entire story.
You need to determine if a specific insurance plan fits you. But, you will need to understand the big picture of health insurance. You will need to understand what your annual deductible is. Your annual deductible is the amount you pay out of your own pocket before the insurance will pay any expenses.
The general rule is healthy people do not need a deductible lower than $5,000. However, if you are a person who goes to the doctor a lot, you should find a low copayment. A copayment is a set amount of money you are charged for medical services.
Coinsurance and copayments are a type of cost-sharing between you and the insurance company. They are 2 different types of payments. Your copayment is when you as the patient, pays a set flat amount to your provider. You usually pay this each time you seek treatment. So when you go to the doctor’s office for a cold you would pay a $30 copay if that’s what yours is set at.
Coinsurance is different, because it is a percentage of costs that you as the patient must pay after you meet your deductible. An example of this would be you have a deductible of $500 before your insurance covers 80% of the charges. This leaves you responsible for 20% and that is known as coinsurance.
Always Compare Health Insurance Costs To Find The Best Plan For You
Usually, a health insurance plan will have a network of doctors and facilities that work with the insurance company. They have an agreement to provide your services at a specific rate. Something that health insurance customers need to realize is that you can use out-of-network providers however, there is a difference between out-of-network providers and in-network benefits
If you decide to go to a doctor who is out-of-network, you could end up paying a much higher coinsurance %. It’s even possible, depending on what your plan says that you might have to pay 100% of the costs.
Sometimes you are forced into using an out-of-network provider. For example, if you are on vacation and a health issue occurs. You might also run into a situation where you go to the hospital and the doctor is in your network although the hospital is not. This raises questions about if your charges are covered or not.
Always examine the policy and where you are purchasing your health insurance from. There is some health insurance out there that is actually just a scam.