Important Components of Health Insurance Plans
Here are 3 key components of health insurance plans that you’ll want to know about as you shop for the right policy for you and your family.
What Your Monthly Premium Covers
- Negotiated Rates - Insurance companies negotiate prices with hospitals for everything from ibuprofen to surgery. This is a benefit for a health insurance policyholder as these negotiated rates generally lower hospital bills between 20%-50%. Negotiated rates are paid for in part by your monthly premium payments.
- Preventative Care Screenings - Your monthly premium payment will also go toward certain preventative measures such as screenings for weight management, tobacco and alcohol screenings and counseling for quitting, and suggested mental health and disease prevention tests.
What Your Co-pay Covers
Co-pay - What is a co-pay? While a co-pay isn’t available for every plan, a co-pay is a flat rate that you are expected to pay for individual services. Your insurance will pay the rest of the amount owed for that service.
Understanding Cost-Sharing: Deductibles, Coinsurance, and Out-of-Pocket Maximums
- Deductible - The deductible is one of the most important aspects of your policy to understand. It is a specified amount of money that you must pay for medical bills before your insurance policy will kick in to help pay with subsequent bills.
- Coinsurance - While not included in all plans, coinsurance is a percentage of your medical costs that you will have to pay after you have met your deductible.
- Out-of-Pocket Maximum - The Affordable Care Act (ACA or ObamaCare) sets the highest limits a plan can have for out-of-pocket payments for individual and family health insurance plans. This out-of-pocket maximum acts as a safeguard for families to ensure that healthcare expenses remain manageable, no matter what happens.