Health Premiums - Which out-of-pocket costs are and aren't covered
Edward Neeman | Published: June 14, 2018
Health insurance covers a range of treatments from doctor services, inpatient and outpatient services, drugs, pregnancy, and childbirth, among others. Some costs are excluded from plans so it is good to get several health insurance quotes to know what is covered and what is not beforehand. First quote health is a great avenue to help you find affordable health insurance with great health premiums.
What isn't covered by health premiums?
Apart from the insurance payouts, there are other costs the patient has to incur on their own, the ones paid before insurance comes in to pay and others that are shared with the insurer. Healthcare plans have annual limits on what a person can pay for out-of-pocket maximum (OOPM) costs. For 2017, the out-of-pocket limit for individual plans is $7,150 and $14,300 for family plans.
To understand how the OOPM works, you need to understand the meaning of some insurance terms.
- A deductible refers to the money you have to pay before your health plan starts paying
- Copayment refers to the fixed fee that you pay every time you access healthcare.
- Coinsurance is the percentage of the total cost of healthcare that you have to pay
What does your insurance plan pay?
Health insurance pays for the following:
- Lab services
- Prescription drugs
- Pediatric services like vision dental care
- Substance abuse and mental healthcare
- Ambulatory services for outpatient
- Maternity and newborn care pre and post birth
- Rehabilitative devices and services
- Preventive and wellness benefits for chronic diseases
Private health insurance can cover more than these in their health plans albeit at higher health premiums.
When you seek treatment, you pay for the deductible, coinsurance, and copayments and when you reach the maximum, your health plan pays the rest of the bills throughout the year. That means if you reach the maximum payout of $7150 for an individual plan and $14300 for family plans, the rest of the bills are paid by the insurer.
You can only reach your maximum out-of-pocket costs if you need lots of medical services. Plans with high monthly health premiums have lower OOPM limits and the ones with lower health premiums have higher OOPM limits. This means that people with chronic illnesses or conditions that require frequent doctor visits should take a good healthcare plan and not rush for a cheap plan. Look for an affordable health insurance plan by looking at several health insurance quotes to check for one with the best terms.
Private health insurance charges more but has better covers. Most people prefer private insurance to state insurance because of this. It is likely to spend more on your treatment costs since the insurance premiums they charge are way higher but different conditions are differentiated so as not to expose themselves to too much financial risk. You should also be able to look at what they cover to avoid too many bills.
Healthcare plans and prescriptions
Insurance must cover one drug in every class and category of medication. In both Medicare and Medicaid insurance, there are over twenty health plans that cover prescription drugs. Private health insurance covers more even for prescriptions since their health premiums are higher.
However, the medication you need might be excluded from the plan meaning higher out of the pocket costs for you. Out-of-pocket costs have a maximum figure attached to ensure you are covered from too much financial risk. As a result, the insurance companies pay your bills for the rest of the year which leaves them exposed.
Prescriptions should be part of these costs but insurance companies have a devious way of covering themselves. Most healthcare plans have excluded prescription coinsurance from the out-of-pocket maximum. Before taking a plan it is good to check a wide range of plans to know which one will reimburse you at a higher rate.
Family plans cover the same way individual health plans do depending on your insurance type. Out-of-pocket premiums are also considered for family insurance and once your family reaches the OOPM, the insurer will pay your hospital bills for the rest of the year. But if only one member of the family reaches the maximum for an individual plan, it will be taken as an individual plan. When the maximum is reached, your health insurance provider takes care of the rest.
First Quote Health can help you shop for the perfect healthcare plan. You can get health insurance quotes for that affordable health insurance plan to keep you covered. We link you to the best health insurance providers with the most affordable insurance premiums monthly to ensure that your finances are not overstrained. All you need to do is input your zip code and voila! Your shopping for the perfect health plans begins.