It’s that time of year again! Many healthcare plan deductibles reset on January 1st, so now is the perfect time to brush up on your health insurance basics. There are so many moving parts and pieces to health insurance that they may seem impossible to understand, and it’s normal to feel confused. We know how frustrating it can be to choose the right plan that fits you and your family’s needs and budget, so we’ve created a one-stop shop for everything you need to know about health insurance.
Decode the jargon: health insurance terms and definitions
Health insurance companies use a lot of jargon we don’t use in everyday conversation, so common terms can be difficult to understand. We’ve put together a few essential health insurance terms and definitions below to make this easier for you.
- Premium: The monthly amount you pay the insurance company to be an active member of their healthcare plan. If you have health insurance through your employer, the employer likely covers a share of your premium.
- Deductible: A fixed amount during your health plan’s benefit period that you have to pay for covered healthcare services before the insurance company pays its share.
- Copay: A predetermined amount you pay for a covered medical service at the time of care. These amounts vary depending on the service. For example, you might have a $30 copay when you visit your primary care physician, $10 copay for a prescription medication, and $250 copay for a visit to the emergency room.
- Coinsurance: The percentage of costs of a covered health care service you pay for after your deductible has been met. For example, if you have 25% coinsurance, you pay 25% of each bill for medical services, and your health insurance covers the remaining 75% of the bill.
- Out-of-pocket maximum: The maximum amount you are required to pay out of pocket during your plan’s period. The insurance carrier and the plan member share the cost of covered medical expenses until this maximum is met. Once this maximum is reached, the insurance carrier pays 100% of the bill for any additional covered services.
- Health Maintenance Organization Plan (HMO): In an HMO plan, you must see a primary care physician or provider within your network. This primary provider can refer you to other providers within your network, acting as a gatekeeper. For example, if you want to see a specialist, you might need a referral from your primary care physician. This defined provider network controls costs, therefore premiums for an HMO tend to be on the lower side, often paired with a low deductible or no deductible.
- Preferred Provider Organization Plan (PPO): In a PPO plan, you have the choice to see both in-network and out-of-network providers, meaning you have more flexibility and can choose the doctors that work best for your needs. The caveat is you will likely pay more for an out-of-network provider. Premiums tend to be higher with PPO plans, and they normally have a deductible.
What’s the difference between copay vs. coinsurance?
Copays and coinsurance may sound similar, but they have some key differences. Here’s a quick breakdown:
| Copay | Coinsurance |
| Fixed fee for specific healthcare visit, like seeing your primary care physician, a specialist or filling a prescription | Variable fee based on a percentage of the total cost of services on the final approved bill |
| Paid at time of service | Billed by the care provider after the charges have been approved and your percentage has been calculated by insurance |
| May or may not count toward your plan’s deductible | You won’t pay this until your deductible has been met (up to your plan’s out-of-pocket maximum) |
READ MORE: COPAY VS. COINSURANCE
What’s the difference between accepted and in-network insurance?
Another key component of any health insurance plan is its provider network, or where you receive care. Your copays and medical bills are directly affected by the providers (facilities and physicians) you see and the negotiated rates your insurance company has with each of them. A provider is considered in-network if your insurance company has a negotiated contract with them for their services. If they don’t, they are out-of-network, or sometimes called “insurance accepted.” Your out-of-pocket cost seeing an in-network provider is usually lower than the cost of seeing an out-of-network provider. This can get more complicated, so we put together a helpful resource with more information.
READ MORE: IN-NETWORK VS ACCEPTED INSURANCE
Does health insurance cover emergency room visits?
The last thing we want to think about when experiencing a medical emergency is how much money will come out of our bank account. The truth is, emergency room care coverage depends entirely on your specific insurance plan.
READ MORE: EMERGENCY COVERAGE IN TEXAS
The Affordable Care Act requires insurance carriers to cover emergency care, so whether you have an employer-provided plan, individual health plan, Medicaid, or Medicare, each will provide coverage. This applies to both in-network and out-of-network emergency room visits, and you will pay the same copay or coinsurance at both, as well.
However, if you’re admitted to an out-of-network hospital as a result of the emergency room visit, you’ll almost certainly be paying more for your care. Luckily for you, all six of our Neighbors Emergency Center locations are in-network with three major health insurance companies!
What you need to know when health insurance shopping
We know health insurance is complicated, especially if you’re not familiar with the terminology. As a result, shopping for health insurance can be a mind-boggling and stressful experience that feels like information overload. Don’t worry, though! We’ve got you covered. You can choose your plan with much more confidence if you’re able to answer these five key questions.
READ MORE: 5 QUESTIONS WHEN SHOPPING FOR HEALTH INSURANCE
In-network emergency care at Neighbors
Neighbors Emergency Center is an in-network provider with BlueCross BlueShield, Aetna and Cigna, but we care for patients with all types of insurance. Helping you navigate the confusing world of insurance is part of how we provide exceptional emergency care, and we are here for you every step of the way. Learn more about insurance at Neighbors.