Let’s face it, health insurance is complicated. The first step to understanding health insurance is grasping these main concepts.
1. Deductible: The annual amount you may be required to pay out-of-pocket before the insurance company will pay for your medical claims. Not all plans require a deductible, but those that have a higher deductible can keep your monthly premiums lower.
2. Premium: The amount you pay to the health insurance company each month to maintain your coverage.
3. Co-payment: Also referred to as 'co-pay' is the dollar amount that you may have to pay up front for a specific type of service. For example, a doctor visit may have a $20 Co-payment.
4. Coinsurance: The percentage amounts that you are obligated to pay towards a covered medical service once you’ve made the co-pay and/or the required deductible. For example your insurance company may only cover 80% of a $100 ER Visit, so you would have to pay the remaining 20% or $20.
5. Maximum Out-of-pocket Costs: This is the set limit of what you must pay per year. Once you have paid this maximum dollar amount, the insurance company pays the full charges for additional covered services for the rest of the year.
"A hospital should also have a recovery room adjoining the cashier's office."- Francis O’Walsh