I am jokingly referring to my husband as The Bionic Man this year. I finally talked him into getting his terrible carpel tunnel fixed on both wrists, plus he is having some other procedures done. All of this medical planning has led me to an increased understanding of our medical insurance, which is super helpful, so I’m going to pass my new-found knowledge on to you.
Deductable: This is the amount you will be responsible for covering for any medical costs before your insurance kicks in and begins to pay. For example, our deductible is $250 (because we have great insurance through my husband’s employer).
This means that we had to cover $250 worth of medical expenses before insurance covered anything. In today’s world, this was pretty much one office visit with his primary care physician for his bi-annual physical (a job requirement) and a portion of his next visit to discuss his wrist pain. Visits, tests, procedures, and even prescriptions often count towards this.
Coinsurance: After you meet your deductible, you will pay your coinsurance percentage for each medical expense, until you meet your out-of-pocket max.
For example, after we met our $250 deductible, our 15% coinsurance kicks in. So, if we had a $1,000 medical bill, we would be responsible for $150, or 15%, of the total bill. You keep on paying your portion of your medical bills, until you reach your-
Out-of-Pocket Maximum: This is the maximum amount you will need to pay, out-of-pocket, for medical expenses during a year. Our out-of-pocket max is $2,000 (once again, pretty good!).
"Met your out-of-pocket max for the year? This is a great time to get any other procedures done you've been putting off."
This means once our co-pays, plus our deductible, adds up to $2,000, we don’t have to pay anymore. Insurance covers everything. Again, this is just for one year, normally January 1 to December 31. It starts over each year with a new deductible.
Per Person: Normally, you have a separate deductible and out-of-pocket maximum for each person on the plan. This means I have to meet my own $250 deductible, and also have a max of $2,000 out-of-pocket, separate from my husband’s medical expenses.
If you have more than two covered individuals, like kids, then you will likely have a total family out-of-pocket, which generally saves you some money. ($2,000 per person, or $5,000 total family).
Life Hack: If you know you are going to have a year with a lot of medical expenses, like surgery, pregnancy, or an unexpected illness or injury, it’s a great time to take advantage of meeting your out-of-pocket max and get some things done you may have been putting off.
By the time my husband gets both wrist surgeries done, we will be pretty close to his $2,000 max, so this year he will have a few benign muscle cysts removed, and possibly some other procedures done, too. Why? Because these procedures are basically FREE if he gets them done this year.
These are great basic terms to understand as you try to understand your current plan, or are shopping around for a new one.
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