Understanding Health Insurance
There are several terms that are important to understand
Maximum out of pocket
DME (durable medical equipment)
The copay is a dollar value that is paid for a consultation. It will range from $0 to $100. The average copay is usually around $40.
The consultation is considered an exam and opinion from the physician. It is a conversation that is had with your doctor.
Procedures do not usually fall in the coverage under a co-pay.
The co-insurance is a portion paid by the patient. Some insurance plans have a co-insurance that applies to everything.
Everything like procedures and doctor visits.
Other plans have a co-insurance only for procedures.
It all depends on the plan you purchase.
I will have examples listed below.
The the patient needs to pay out of pocket, before the insurance kicks in.
The insurance will typically start working at a percentage.
Most insurances are set up as 80/20.
This means insurance pays 80% and the patient pays 20%.
This continues till the maximum out of pocket dollar value is reached.
At that point the insurance pays 100%
The amount you pay per month for health insurance.
Usually, the more you pay, the lower the copay/coinsurance and deductible.
Patient A has a copay of $40 with a $1000 deductible and a 90/10 policy. Max out of pocket $7000
Patient B has a coinsurance plan where all interactions go to the deductible (office visits/procedures) and a $1000 deductible and a 80/20 policy. Max out of pocket $7000
Patient A and B go to the doctor for a consult and no procedures are done. The doctor bills the insurance at a contracted rate of $200
Patient A pays $40 (might go to deductible, goes to max out of pocket)
Patient B pays $200 (goes to deductible and max out of pocket)
Let’s pretend patient B has reached their $1000 deductible, then patient B would pay 20% of $200, or $40.
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