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Shoulder & Hand Therapy Center​​

Six Money Terms You Need To Know When Using Health Insurance

When a new patient comes in one of the first things we discuss is insurance. When I start mentioning the deductible, out-of-pocket, limitations, and so on, some, especially those new to insurance, are unfamiliar with these terms. So let me show you how understanding these terms can help you manage your care and save you unexpected cost. Of course every insurance policy is different, so always check your benefits before using.

Usually, but not always, insurance renews each calendar year on January 1st. On that day, your deductible becomes due again, your out-of-pocket amount resets to zero, as well as the limitations on some services.  So let's talk about ...

#1: Your Deductible

This is the amount of money you have agreed to pay each year before insurance begins to pay towards your health care.  There is an individual and family deductible.  The family is usually double the individual.  Deductibles can range from $500.00 and up per year.  Some high deductible plans are $5,000 to $10,000, maybe more.  So, if my families first medical expense of the year was an emergency surgery, I would have to cover my individual deductible of $2,500 before insurance paid, I would still get the benefit of contractual rates.  My spouse and children would have another $2,500 in medical expenses before insurance began paying out, for a total of $5,000.  Once the deductible is met, your insurance will pay the contracted rate, usually from 50-90% and you pay the remainder (co-insurance) 10-50%..  

There are some exceptions to the deductible as some well-care, preventative, therapies or other ancillary services are exempt from the deductible.  These services, like a wellness check-up, may have a co-pay, a flat fee you pay each time you see the doctor.  The visit is covered in the co-pay, but any tests, medications, or other services your doctor may suggest will most likely apply to your deducible (be your responsibility).  This usually results in a surprise bill and more money out-of-your pocket for health care.  Most co-insurance or co-pay amounts are applied to your deductible, but check your policy.  Sometimes prescription, vision, and dental coverage may have it's own deductible.  

Watch for the next post: 

Out-Of-Pocket, Co-pays, Co-insurance, and Limitations