Insurance Basics

From Dottie Steinhoff:

Insurance Basics

Terms:

HMO – Type of plan that you can ONLY see who is in network and generally has a co-pay associated with every visit.

PPO – Type of plan that allows you to see people that are in or out of network. There are difference costs associated with in-network vs out-of-network providers. No-copays usually but some have a Co-pay for specialists, therapy, or ER visits.

Deductible – an amount you must pay before the insurance will start paying for medical costs and medications. The amount you pay for covered health care services before your insurance plan starts to pay. With a $2,000 deductible, for example, you pay the first $2,000 of covered services yourself.

Premium – The amount an employee pays of the cost of their health insurance every pay period. Often the lower the premium the higher the deductible.

HDHP – High Deductible Health Plan – these plans are often less per month (premiums) but a patient must pay out of pocket for thousands of dollars before the insurance “kicks in.” They are defined by any plan with a deductible of at least $1,400 for an individual or $2,800 for a family.

Cost Share Plan – This is a plan that people pay into and then when one person in the “community” has a need, they submit the bill to be reimbursed or “shared.” They vary in what they cover and some are heavy on preventative care and others are more geared toward catastrophic events

Co-pay – this is a fee required by some insurances at every visit. There is often a Primary Care Co-pay, Specialist Co-pay, and an ER/UC Co-pay. Usually somewhere around $20-$50 dollars for office visits and $50-$100 for Specialists. The ER Co-pay varies greatly depending on

Co-Insurance – this is what you pay after your deductible. For example, a lot of plans have 80/20 co-insurance. Once the deductible is met, the insurance will pay 80% and you pay 20% of the allowable amount. https://www.healthcare.gov/glossary/co-insurance/ I seriously had a hard time with this until I read this site.

Allowable Amount – The price the insurance contracted for a service or procedure. For instance, Cigna covers a therapist but only at the $95/hr allowable amount. If I see a therapist who is contracted with Cigna and they normally charge $120/hour, Cigna will still only pay them $95 per hour.

Reading this site or bookmarking it for reference is very very helpful. https://www.healthcare.gov/glossary/

This takes you to the glossary and you can look up any term you like. Once you understand the basics we can go into the details of specific insurance plans.