Health insurance can be pretty overwhelming. Brokers and insurance carriers use jargon and acronyms that can seem like a foreign language. It makes it hard to select a plan when you don’t really understand what any of it means. Luckily, SnapHealth is here to help. This article is your resource for understanding health insurance terms, which will help you to choose a plan that’s right for you.
You can think of your monthly premium like a subscription fee. This is the price that you pay to be a plan member. Paying this cost gives you a member ID number (printed on your insurance card) and gives you the benefits that come with your plan. The payments you make to pay your monthly premium do not go towards any medical costs that you may have, and do not count towards your deductible or out-of-pocket maximum. This is just what you pay to have your insurance policy.
Advanced Premium Tax Credit (APTC)
APTCs are tax credits available to certain households that pay for the all or part of the monthly premium, in the event the household income is below a certain level. Among other things, eligibility for APTC is based on total household income, compared to the number of individuals claimed on the household’s income tax return. Households with low income may be eligible for plans with as little as a $0 monthly premium. It is important to note that if your annual income exceeds what you put on your insurance application, you may end up owing these tax credits back when it comes time to file your taxes. For this reason, most state based exchanges will require an income verification process. If you enroll through SnapHealth, our team will help you through this process.
The deductible is the amount that you will have to spend, before your insurance starts to pay their part. You can expect to pay for the majority of your care, until you spend the amount equal to your deductible. Once your deductible is met, you will start to reap more of the benefits of your insurance policy. If you are on a family plan (multiple family members on the same policy), you will have a separate deductible for each individual as well as a deductible for the family. For Major Medical plans, the family deductible is typically double the individual deductible. Generally, each person in the plan has to hit the individual deductible before the next stage (coinsurance) starts. However, if two or more plan members have high claims, the family as a whole is capped at the family deductible amount. Then it is treated as if all members have met their deductible and further coverage begins.It is important to note that your deductible will reset annually, when your plan is renewed. For those who have individual insurance, not through an employer, that is the first of January. If you have insurance through your employer, your insurance may renew at a different time of the year.
Healthcare costs can be expensive, luckily your policy will identify an out-of-pocket maximum that will put a cap on what you could have to pay. This amount indicates the most that you would have to pay in a year for covered services. The out-of-pocket maximum includes any monies paid toward copays, deductible, and coinsurance amounts, BUT NOT your premium. Each plan member will have to hit their own limit, until the family out-of-pocket maximum has been met. After that point, your insurance will pay all of the costs associated with covered services. Your explanation of benefits will explain what services are covered through your policy.
A copay, or copayment, is a fixed amount that you would have to pay for a covered healthcare service. Typically providers will require you to pay any copay that you may have prior to any visit or treatment. Copays will vary depending on the type of service ie. primary care visits, specialists, ER visits, etc. Your explanation of benefits will outline these costs for you. You should also be able to see these amounts when comparing plans through the marketplace or through a SnapHealth quote.
A network, in terms of health insurance, is a group of providers that your insurance carrier would prefer you to use. Seeing doctors that are in-network will cost less than doctors that are out-of-network. If you have a preferred provider, be sure to check that they are in-network with the carrier, prior to enrolling in a plan. Otherwise, you could end up having to pay more to see your doctor, or having to find a new provider that is in-network. Some plans will have very large networks, with lots of providers that they work with, and some plans will have smaller networks with limited places to go for in-network care. To see if your provider is in-network, you can use the link provided with your quotes from SnapHealth to search for your doctors in the insurance carriers’ databases. At SnapHealth, we always suggest following up with a call directly to the provider’s office, to confirm that they accept the insurance you’re looking to enroll in.
Some insurance policies will have a coinsurance for certain healthcare services. What this means is that they will cover a portion of the cost and then the individual will pay the rest. For example, they may have an 80/20 coinsurance for urgent care services. This would mean that the insurance company would pay 80% ($0.80 per every dollar) of the total bill, and you would pay the remaining 20% ($0.20 per every dollar) of the bill. You can compare coverage costs, including coinsurance, through SnapHealth’s quotes. If you are shopping around and comparing coverages, occasionally they will only list one percentage. Carriers are not always consistent with which amount they list: your cost, or theirs. When it comes to coinsurance, it is important to know that your insurance will always cover the larger portion of the cost. For example, if the explanation of benefits lists a 20% coinsurance, that indicates YOU pay 20%, but if they list 70% coinsurance, that means YOU would pay the remaining 30%. If you get confused by these numbers, you can reach out to your broker, or SnapHealth representative for clarification.
These are free benefits that must be offered by all compliant health insurance plans. Compliant plans do not include faith-based plans or short-term medical options. That said, compliant plans cover services like annual physicals, colonoscopies, and mammograms. You can find a full list of what falls under preventative here.
At the end of the day, there is no one-size-fits-all when it comes to health insurance plans. That’s why there are so many options made available. Be sure to talk to a certified broker about your specific circumstance, or use SnapHealth to get a personalized quote, narrowed down to three recommended plans that meet your unique needs.