What happens after I meet my health insurance deductible?
The current confusion and conflicts regarding the Affordable Care Act (Obamacare) and a new plan being offered by the U.S. House of representatives are likely to continue for an unspecified period of time. Therefore, it is wise to step back from the political battles and get back to basic insurance coverage.
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Understanding Health Insurance Deductibles
While a lot of people are covered by the ACA, there are more covered by their employers, or the family is able to afford. thus it is necessary to get back to insurance basics.
The deductible for a healthcare policy is that amount the person has to pay out for covered medical expenses. This is on an individual basis for each person in a family or an employee group.
Each company has its own procedure for determining the cost of deductibles. in many cases, individuals are able to choose the deductible they are willing to pay.
A higher deductible will result in lower insurance premiums.The deductible can vary significantly among insurance companies and choices made by individuals, businesses and the government.
For example, in 2016 the average deductible for an individual covered by Obamacare was $4,538. The deductible for an average family was $7,983.
The Obamacare averages are a good reference point because Obamacare was not an insurance policy, but rather a network of insurance carriers offering coverage. The number of participating insurance companies has been declining, thus giving the consumers fewer options.
Understanding that there is more to health care coverage than deductibles, it becomes necessary to examine the issues involving copays for medical service.
Every procedure covered by a health care policy will usually have a copay requirement. A visit to a doctor may have a copay of $20, provided the deductible has been met.
In virtually any medical situation, a person with health care will have to pay the required co-pay for the services provided. Different specialties can charge different prices. Usually, the more intense treatment or surgery will result in a higher copay.
A hospital stay will also result in a fixed amount for the copay. It may be a dollar value or a percentage. After the copayments are made, then the remainder of the medical expense will be covered by the insurance company which could cost hundreds or thousands of dollars.
Copayments are unpredictable and subject to change. This is true for doctors, lab work, emergency room visits and special and traditional hospital services.
The other category is the PPO or Preferred Physician Organization. This is a hybrid of regular insurance and Medicare. It is designed for people under 65. The patient has more flexibility in a PPO.
This plan can be offered as a group policy for businesses. More specialists are likely to be in a PPO.
Health Insurance for Seniors and Medicare Deductibles
Medicare is insurance for those 65 and older. It also covers some younger people who have special health problems. Persons using standard or original Medicare will see it working like regular insurance. There is a deductible that has to be paid for doctors and hospitals, and medication will come through private companies approved by Medicare.
Those eligible for Medicare may choose a Medicare Advantage Plan, which works much like a Health Maintenance Organization (HMO) that is often used group insurance organization. The Advantage plans may offer special services.
However, there is usually a geographic limit as to where the plan can be utilized, and the customers are limited to using doctors and facilities within that network.
Understanding the basis for insurance is pretty simple. The patient pays a fee, and the insurance company will provide finances to cover medical services. There are a few things to remember:
- Insurance companies and medical facilities will charge a deductible which may mean that a person could have several visits to the doctor before the policy starts coverage cost.
- After the deductible is met, the doctors and medical facilities will charge a co-pay for certain procedures.
- Individuals can be covered by a private pay policy, a group policy provided by your workplace or some other special interest group. The fees that are charged will vary in all cases.
- A PPO, Preferred Patient Organization, can cover a large group that is not limited to the employees of one company, neighborhood or even city.
- People can be covered by traditional Medicare, where an individual pay a deductible before any coverage kicks in and then pay 80 percent of the remaining bill.
Finally, healthcare in the United States is very fluid. Medical costs are increasing, which causes the price of insurance to increase. The Affordable Care Act, which among other things, prevented insurance companies from denying service because of pre-existing conditions.
Therefore, insurance, while a virtual necessity, is an ever-changing institution that can impact our daily lives.
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