Health insurance is in the news everywhere and the biggest news of all is the dramatic premium increases. This leaves businesses and families in a quandary on how to pay for health insurance. Policies for a family on four can range from $400 to $1700 across the country.
The wide premium range usually comes down to the annual medical insurance deductible and out of pocket insurance coinsurance maximums. Deductibles can commonly range from $500 to $10,000 with out of pocket coinsurance ranging from $1000 to $15,000. I am sure you already guessed if you want the low deductible plan you are paying big bucks. If you can't pay big bucks then you are stuck with a high deductible policy.
Just to make sure we all understand let's define a medical deductible. It's the monetary sum you are billed first before the insurer starts to cover your expenses. So a simple example, you break your leg and the resulting medical bill is $7000. If your deductible is $1000 then you pay $1000 for you accident and the insurance company will pay a portion of the remaining $6000. If your deductible is $7000 or higher you are out of luck, because your insurance company has no obligation to cover you for any medical emergency until your expenses exceed your deductible.
The second part of this is the Out of Pocket Insurance Coinsurance Maximum. Again to make sure we understand, coinsurance is usually a percentage you pay for your medical expenses up to your out of pocket maximum. The coinsurance percent can vary from 10% to 50% depending on your plan. Of course the higher your premium the lower your percentage. Using our same example with the $1000 deductible if your coinsurance percentage is 20% and out of pocket maximum is $5000 then your remaining bill is $1200 (20% times the remaining $6000). So your total bill is $2200 with the insurance company paying $4800. On the other hand if your coinsurance is 40% with an out of pocket maximum greater than $3600 then your bill is $2400 (40% times the remaining $6000) plus your deductible $1000 for a total of $3400. In this case the insurance company pays $3600. Of course if you had the $7000 or higher deductible the out of pocket maximum would not have mattered.
So to summarize it's very important to understand how deductibles and coinsurance effect how your insurance company covers your medical expenses. Next let's outline a way you can protect yourself against high premiums, deductibles and coinsurance with a low cost Medical Discount Plan. These plans are available with varying levels of coverage. Some plans come with rich insurance backed benefits for hospitalization, intensive care, critical illness, accidental death and dismemberment, doctor and dentist visits and accidental injury to name a few. One reason these plans have become very popular in recent years is that most benefits don't even have a deductibles. Plans like these generally cost a little over $200 for any family size and can be used to cover the deductible gap for high deductible insurance plans. Still some businesses and families use them as standalone plans.
The wide premium range usually comes down to the annual medical insurance deductible and out of pocket insurance coinsurance maximums. Deductibles can commonly range from $500 to $10,000 with out of pocket coinsurance ranging from $1000 to $15,000. I am sure you already guessed if you want the low deductible plan you are paying big bucks. If you can't pay big bucks then you are stuck with a high deductible policy.
Just to make sure we all understand let's define a medical deductible. It's the monetary sum you are billed first before the insurer starts to cover your expenses. So a simple example, you break your leg and the resulting medical bill is $7000. If your deductible is $1000 then you pay $1000 for you accident and the insurance company will pay a portion of the remaining $6000. If your deductible is $7000 or higher you are out of luck, because your insurance company has no obligation to cover you for any medical emergency until your expenses exceed your deductible.
The second part of this is the Out of Pocket Insurance Coinsurance Maximum. Again to make sure we understand, coinsurance is usually a percentage you pay for your medical expenses up to your out of pocket maximum. The coinsurance percent can vary from 10% to 50% depending on your plan. Of course the higher your premium the lower your percentage. Using our same example with the $1000 deductible if your coinsurance percentage is 20% and out of pocket maximum is $5000 then your remaining bill is $1200 (20% times the remaining $6000). So your total bill is $2200 with the insurance company paying $4800. On the other hand if your coinsurance is 40% with an out of pocket maximum greater than $3600 then your bill is $2400 (40% times the remaining $6000) plus your deductible $1000 for a total of $3400. In this case the insurance company pays $3600. Of course if you had the $7000 or higher deductible the out of pocket maximum would not have mattered.
So to summarize it's very important to understand how deductibles and coinsurance effect how your insurance company covers your medical expenses. Next let's outline a way you can protect yourself against high premiums, deductibles and coinsurance with a low cost Medical Discount Plan. These plans are available with varying levels of coverage. Some plans come with rich insurance backed benefits for hospitalization, intensive care, critical illness, accidental death and dismemberment, doctor and dentist visits and accidental injury to name a few. One reason these plans have become very popular in recent years is that most benefits don't even have a deductibles. Plans like these generally cost a little over $200 for any family size and can be used to cover the deductible gap for high deductible insurance plans. Still some businesses and families use them as standalone plans.
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