Lets Talk Health Insurance
So let's admit it. When we are thrust out in the real world (what I like to call adulting) there are a lot of decisions we are suddenly expected to make that we probably did not think about. I admit that I am well educated and have multiple degrees, but I also admit that at some times I can be naïve. Coming from a public health background I understand the intricate details of health insurance; however, I had a tendency to make assumptions that everyone else did. Most Millennials and Generation Z’ers are at a point in their life in which their career is taking off or they are landing their first job in their career field. Most of us are aging out of our “safety net” in which we are no longer eligible to be on our parent’s health insurance and must get our own. Health insurance typically comes through your place of employment, school, or by purchasing your own. The Patient Protection and Affordable Care Act required almost everyone in our nation to maintain health insurance by means of an individual mandate or pay a tax penalty. With the recent passage of the tax bill that individual mandate will be repealed; however, WE STILL NEED TO PURCHASE HEALTH INSURANCE.
There are a lot of myths and misconceptions regarding health insurance. And let’s just face it, if you are like me health insurance was not discussed in school and your parents never sat you down and explained it to you. So, I have set out on a journey these last couple of years to truly understand health insurance and am now equipped to break it down for you. The next couple of post will be dedicated to breaking down what you need to know about health insurance. So lets kick it off by covering 5 buzz words you need to know.
Premium: The amount you pay each month for your health insurance. Think of it like a cell phone bill. You pay your cell phone provider each month to use their network. This is the same with health insurance. You pay a premium each month for access to a network of Doctors. This amount you pay for your monthly premium varies depending on multiple factors such as what type of plan you choose and if you are or plan by yourself versus being on a family plan. It will also vary if you are solely responsible for paying the monthly premium, if your employer pays a portion of the premium, or if your employer pays your entire monthly premium.
Deductible: A deductible is the amount of money you pay out of pocket yearly for services before your health insurer starts paying. For example, if you have a $1,000 yearly deductible once you have spent $1,000 out of pocket on qualifiable health expenses then your insurer would start paying a portion of any services that follow. Most services that you receive from a Doctor will require some type of payment, but thanks to the Affordable Care Act there are certain preventive care benefit that most plans (at least all marketplace plans) cover for FREE. This means that you will receive these services for free without being charged a copayment or coinsurance fee. Some of these services are well-women visits, cervical cancer screening, cholesterol screening, depression screening, diabetes screening, immunizations, autism screening, developmental screening, and more. Let me say this again for the people in the back, with health insurance you receive certain preventive services for free with out having to pay a co-pay when you show up to the Doctor's office or receiving a bill for the service. For a complete list of these services visit healthcare.gov.
Co-payment: A co-payment is a flat rate you pay for certain medical expenses and your insurer pays the rest. For example, your co-payment for a primary care physician visit may be $10, $50 for specialty care visits such as seeing a cardiologist, and $100 for an emergency room visit. When you are shopping around for plans these co-payment fees should be listed. This is important to take into consideration when choosing your plan.
Co-insurance: Once you reach your deductible limit then you enter the co-insurance phase. This is when your insurer will pay a percentage of the bill. For example if you have a $1,000 deductible, once you have met that deductible that year then your insurer may cover 80% of the following bills and you are responsible for paying the other 20%.
Out of pocket maximum: This is the maximum amount of money you can pay out of pocket during the year. It includes deductibles, co-payments, and co-insurance. It does not include your monthly premium. Once you reach that maximum then your insurer will pay 100% of the services you need after. For example, if you have a $6,000 yearly out of pocket maximum, once you have paid $6,000 for eligible services your insurance will pay everything else.