KNOW-ledge Is Power

by | Sep 29, 2016 | Employee Benefits, Health Insurance

Do you know what you need to know when choosing the right health plan?  The worst mistake you can make is choosing by price.  The most expensive might not be the best for you and the cheapest could certainly be a big mistake.  Health plans have changes more in the last five years than the previous twenty years.   Long gone are the days where you hand a provider your health insurance card and you are all set.  Health insurance carriers have had to make many changes to fight the rising cost in this complex industry.   Things change often and if you don’t stay on top of it all, you could make costly mistakes.  We don’t want that to happen so, here are some of the newest terms that you will now find in your policy so that you can make a good decision on what plan is best for you.

Coinsurance – The amount or percentage that you pay for certain covered health care services under your health plan. This is typically the amount paid after a deductible is met, and can vary based on the plan design.

Consumer-driven (also known as consumer-directed or consumer choice) Health Care (CDHC) – A plan designed to be more affordable because they offer reduced premium costs in exchange for higher deductibles.

Copayment – A flat fee that you pay toward the cost of covered medical services.

Deductible – A specific dollar amount you pay out of pocket before benefits are available through a health plan.

Health Management Organization (HMO) – A type of health insurance plan that usually limits coverage to care from doctors who work for or contract within a specified network.   With HMOs you select a primary care physician who is responsible for managing and coordinating all of your health care.

Health Reimbursement Arrangement (HRA) – An employer-owned medical savings account in which the company deposits pre-tax dollars for each of its covered employees which employees can then use this for qualified health care expenses.

Health Savings Account (HSA) – An employee-owned pre-tax medical savings account used to pay for eligible medical expenses. Funds contributed to the account do not have to be used within a specified time period. HSAs must be coupled with qualified high-deductible health plans (HDHP).

High Deductible Health Plan (HDHP) – A health plan that combines lower monthly premiums in exchange for higher deductibles and out-of-pocket limits. These plans are often coupled with an HSA.

In-network – A physician or a specialist within an outlined list of health care practitioners.

Out-of-network – Health care you receive without a physician referral, or services received by a non-network service provider subject to deductibles and copayments.

Out-of-pocket Expense – Amount that you must pay toward the cost of health care services including deductibles, copayments and coinsurance.

Out-of-pocket Maximum (OOPM) – The highest out-of-pocket amount paid for health care services.

Primary Care Physician (PCP) – A doctor that is selected to coordinate treatment under your health plan.

Balance Billing – When a provider bills you for the difference between the provider’s charge and the amount allowed on your health care plan.  A preferred provider may not balance bill you for covered services.

Summary of Benefits and Coverages (SBC) – A uniform, easy-to-read summary that lets you make apples-to-apples comparisons of cost and coverage between health plans.

Limited Network –Health care plans that have a lower monthly premium, but a limited choice of providers.

If you have questions about your coverage or coverage you are considering, call our FBinsure offices at 508-824-8666 and ask for me, Rich Volkmann.


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