We’ve talked a lot about health insurance this week from general information to how/where to get it, what to do health insurance wise if you’re a college student on your own, as well as if you’re covered for a medical air ambulance in case of emergencies/ specialized transport.
This blog is going to touch on some of the acronyms and terms more frequently used when dealing with health insurance.
To start, you may have heard of terms like HMO, PPO, EPO, and POS, but what do these terms really mean?
HMO:
Stands for Health Maintenance Organization and is meant for people trying to stay within their network of coverage except in dire emergencies. Procedures and specialists will require referrals. This plan is for lower out of pocket costs and a primary doctor for you which includes working with your specialists.
PPO:
Stands for Preferred Provider Organization and is meant to be able to go in and out of your network but in network is less expensive. This requires no referrals and is for someone who wants a wider variety of provider options.
EPO:
Stands for Exclusive Provider Organization and is meant for in network, except in cases of emergencies. This however, does not require referrals and is meant for lower out of pocket costs and no required referrals.
POS:
Stands for Point of Service Plan and is meant to give you the option of going out of network but only with a referral. This is for someone who wants more provider options, but also with the ability to visit a primary doctor on a routine basis.
Armed with this knowledge, compare the overall health plan networks. If you have a doctor(s) you like to see regularly and have maintained a relationship with, make sure their practice falls within the new plan you are considering. Should you not have a preferred doctor, find plans with larger networks, as they will have more options.
Know your exact benefits and what out of pocket costs there could potentially be. Below are some terms to help you better understand these costs.
Deductible:
The deductible is a yearly price that you must pay until your insurance provider starts covering a portion of or the remainder of the costs. If your deductible is $500 then you must spend $500 before insurance takes over paying the any sort of amount. A deductible will reset every year.
Copayments:
Your copay is a predetermined rate for services at the time of care. Every visit you make to see a doctor would require an upfront fee that you are responsible for paying. Such as, a copay of $25 at check-in, or an ER visit that demands $300 before the patient is see by a doctor. Copay prices vary depending on the company and the plan you’ve chosen.
Coinsurance:
This is a % of medical expenses that you are financially responsible for, while the rest is taken care of by your provider, after having met your deductible. For example, if your coinsurance is 30% and deductible is $500, once you’ve reached the $500 deductible, your provider covers 70% of medical expenses. Leaving you responsible for the remaining 30%.
Premium:
Your premium is the monthly bill you receive for your health insurance coverage, regardless of whether you’ve used it or not. In most cases your employer provided insurance will pick up the majority or all the premium cost.
Out of Pocket Maximum:
This is the max amount you required to pay in a year before health insurance starts covering 100% of bills.
If you are the parent or guardian of an upcoming or recent college graduate, make sure you go over these concepts as they will need to know them and be familiar with them as they move into the work force. If you are currently a full-time student at a public or private university or college, ask your parents to show you how their healthcare plan(s) works and to explain how the process of acquiring insurance works. Understanding health care and the resources you have available are not normally taught in schools, but are a crucial part of moving forward into adulthood. This is information everyone needs to know. Stay informed and do your research on health care plans, reforms, and changing policies agency and government-wide!