by Blue Cross, 2018
Health insurance helps protect you from the high costs of
health care. It helps you pay for doctor visits, hospital stays, prescription
drugs and important preventive care.
You
can choose from a variety of health insurance plans with different levels of
coverage to fit your needs and budget.
A
health plan example
Health insurance definitions
Health insurance definitions
Let’s
say you’ve had a serious accident. Your medical bills are $50,000. Health
insurance may make a huge difference in the amount you'll pay. In this example,
all the care you receive is from doctors and hospitals in your plan network.*
Your costs in this
example
Yearly
deductible: $5,000
Coinsurance:
20%
Yearly
out-of-pocket maximum: $6,000
How it works
1.
In
this example, you pay the first $5,000 (your deductible) before your plan
begins to pay.
2.
After
you pay the deductible, you pay 20 percent of your health care costs until you
reach your maximum out-of-pocket amount ($6,000). That means you only pay $2
out of every $10 for covered services until you’ve paid $6,000.
3.
Once
you’ve paid $6,000, your health plan pays the rest of the cost for covered
services you receive in network.
Total amount you'd
pay in this example:
Bill for
services: $50,000
You pay:
$6,000
Your plan
pays: $44,000
Coinsurance: The percent of the cost you pay
for covered services. For example, you pay 20 percent of the cost for a doctor's
office visit or hospital stay. Your plan pays the other 80 percent. Not all
plans include coinsurance.
Copay: A small, flat fee you pay for some covered care at
the time of service (for example, $25 for an office visit). Some plans do not
require a copay.
Covered costs: Medical tests, office visits,
treatments, supplies, medications and services your plan covers. To find out
what your plan covers, log into the member site, call the number on the back of
your ID card or check the contract in your member welcome kit.
Deductible: The amount you pay for health care
each year before your plan begins to pay.
Formulary: A list of drugs your plan covers.
If you fill a prescription for a drug your plan doesn’t cover, you’ll pay the
full cost. This cost will not count toward your deductible or out-of-pocket
maximum. How to understand prescription drug
benefits.
Health savings
account: Before-tax
contributions you make to an HSA account. You can use HSA funds to pay for some
covered health care costs. See how a health savings account (HSA) works. See how a health savings account
(HSA) works.
Network: The
hospitals, doctors, pharmacies and health care professionals that sign a
contract with a health plan to provide care or prescription drugs for its
members. These are also known as participating or in-network providers. To get
the most coverage, you receive care from providers in your health plan network
and pharmacies in your plan’s pharmacy network. Some providers or pharmacies
may not be in a plan’s networks. Providers or pharmacies in one network may not
be in another network. Some plans have a focused network. A focused network
means that only certain providers or pharmacies participate in the plan’s
provider or pharmacy networks. If you visit a provider or a location that is
not in the plan network, you will pay more for your care. If you get a drug
from a pharmacy that's not in the plan network, you will pay more, or even the
full cost for your drug. These out-of-network costs do not count toward your
in-network cost-sharing (for example, your deductible and out-of-pocket
maximum).
Out-of-pocket maximum: The most you could pay each year for
covered services you receive in network.
Premium: The monthly amount you pay for
your health plan. Usually, a lower premium comes with a higher deductible and
out-of-pocket maximum.
Norb Leahy, Dunwoody
GA Tea Party Leader
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