What do you mean I have a deductible?
Hello everyone, today we are going to talk about deductibles.
First let talk about what is a deductible. A deductible is the total amount you must pay out-of-pocket before your insurance starts to pay. Your deductible will reset to $0 at the end of your health insurance policy year. This means you will be liable to pay for all qualified services until your deductible is met for the year. For example, if your deductible is $1,000, then your insurance will not pay anything until you have paid $1,000 for services subject to the deductible Please keep in mind that the deductible may not apply to every service for which you have paid. Furthermore, even after you have met your deductible, you may still owe a copay or co-insurance for each visit. Now you may be asking yourself, what is a copay and co-insurance? Please read the following:
What is a copay?
This is a fixed amount you must pay for a covered service, as defined by your health plan. Copays usually vary for different plans and types of services. Typically, you must pay this amount at the time of service. Copayments are fixed, regardless of the visit length, which means you will always pay the same amount. In most cases, copayments go toward your deductible.
What is a co-insurance?
This type of out-of-pocket payment is calculated as a percent of the total allowed amount for a particular service. In other words, it is your share of the total cost.
· Your insurance plan’s allowed amount for an office visit is $100.
· You have already met your deductible.
· You are responsible for a 20% co-insurance.
In this situation, you would pay $20 at the point of service. The insurance company would pay the rest of the allowed amount for that visit. Keep in mind that the co-insurance amount may vary from visit to visit depending on what services you receive.