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Understanding health insurance
by Maura HallamWith the expanded health insurance coverage mandated by the Affordable Care Act (also known as Health Care Reform) that went into effect Jan. 1, 2014, an estimated 786,245 uninsured people in Washington state will be able to get health insurance — some for the first time.
Health insurance can be a huge help when it comes to paying for health care. But for most of us, it doesn’t pay for everything. Here’s a list of some of the more common terms you’ll see when it comes to health insurance costs:
Premium: Most plans have a monthly fee, called a premium, that you pay in order to keep your health insurance coverage active.
Co-pay: This is the amount of money you are required to pay directly to the doctor’s office, clinic, pharmacy or other health care facility at each visit. This amount can vary depending on your insurance plan, but is often between $10 and $30.
Deductible: This is the amount of money that you have to pay out of your own pocket each year before your insurance company will begin paying toward your care. For example, if your health insurance has a $500 deductible, your insurance company won’t start paying for your health care needs until after you’ve spent $500 of your own money. This amount usually adds up over the course of the year, so you don’t have to worry about having to pay the deductible all at once.
Many insurance plans will cover specific doctor’s visits 100 percent, such as annual exams, even if you haven’t met your deductible yet. Review your insurance plans benefits to find out what visits are covered.
Out-of-pocket: For doctor visits or medical treatment that your insurance plan doesn’t cover 100 percent, you can expect to receive a bill from your doctor’s office or other location where you got treatment, after your insurance company pays its portion of the charges. These are called out-of-pocket expenses.
Remember: You have the right to ask your doctor or treatment location for a good-faith cost estimate before treatment. This estimate isn’t a guarantee of your final costs, but it can give you an idea of what you can expect your final bill to be.
Out-of-pocket Maximum: After you’ve met your deductible amount, you will still have to pay a part of your health care costs. For example, your insurance provider may pay 80 percent of your costs, and you must pay the other 20 percent. However, most insurance companies also put a limit to the total amount of your own money that you have to pay for your health care each year. This is the out-of-pocket maximum. Once you have reached that amount (and it, like everything else, can vary between insurance plans), your insurance plan normally will pay 100 percent of any other allowable health care bills you have for the rest of the year.
In-Network Provider: Providers (doctors, hospitals and other health care facilities) may have formal contracts with insurance companies. These contracts set the prices that insurance companies will pay those providers, known as “in-network providers.” Because they have these contracts in place, insurance plans will usually pay more of your health care bills if you see one of those providers for care, than if you go to a doctor or hospital that is “out-of-network.” In some cases, if you see an out-of-network provider, your insurance company will pay less. And sometimes, they won’t pay anything at all. So be sure to double check this before you receive care.
Specific costs and coverage will vary depending on the plan that you have. So when it comes to the details of your plan’s coverage, the best thing to do is to read your benefits description very carefully. And if you are ever in doubt about whether your insurance will cover a specific medicine, treatment or doctor visit, call your insurance company first. Most doctors’ offices and other health care providers don’t know all the ins and outs of every single insurance policy, so going straight to the source is always your best bet.
If you're eligible for health insurance under the expanded coverage, it's not too late to enroll. Learn more at multicare.org/healthreform.
Posted on Jan 7, 2014 in Health Reform
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