Wellfie Wednesday Tip #97: Health Literacy 101
/Happy Wellfie Wednesday and Welcome back! This week’s #WellfieWednesday post is brought to you by Aaron (@AaronPerezPT). Enjoy!
Deductible…What did you just call me?!
Lately I’ve been trying to learn more about healthcare in the United States. I’d like to say it’s been an easy learning process, but I’d be lying. I find it strange and somewhat saddening that even I, as a healthcare provider, struggle navigating the insurance world. I’m certainly not alone; a 2014 study found many Americans struggle with health insurance literacy. Historically, we have paid a lot of money for healthcare. Trends show those numbers are continuing to sky rocket and much of what we spend is becoming more “visible” to us. There also seems to be support for transforming Americans into more traditional “consumers” of healthcare. In other words, there is a push for individuals to bear more up-front costs when purchasing healthcare. It seems unreasonable to place responsibility of purchasing healthcare services on individuals without at least educating them on the basics health insurance. So, I thought a post explaining some basic insurance terms may be helpful.
Premium
The amount you pay monthly for health insurance. You pay this even if you do not use healthcare services.
Deductible
The amount you pay out-of-pocket for healthcare services before your insurance starts paying. This is separate from your premium contribution. For example, if you have a $1,000 deductible, you will need to pay for the first $1,000 of any healthcare services you receive.
In-network
These are doctors who your insurance has negotiated lower rates with than they would otherwise charge in most cases. You will typically spend less if you go to an “in-network” provider, though this may not always be the case.
Out-of-network
These are doctors who your insurance has not agreed upon a negotiated price with. Typically, you’ll pay more if you receive services from an “out-of-network provider”, though this may not always be the case.
Out-of-pocket maximum
This is the most you’ll pay for any healthcare services you receive within a given year. For example, if your out-of-pocket maximum is $7,000, once you reach this amount insurance will pay for everything else except for co-pays.
Co-pay
A fee that you pay each time you use a specific service. This fee does not count towards your deductible. Typically, office visits (i.e. family doctor visit) carry less costly co-pays while specialty care (i.e. cardiologist) and emergency room visits carry more costly co-pays.
Co-insurance
Your plan may have a co-insurance. This is a percentage of cost you share with your insurer after your deductible is met. For example, if you have a 30% co-insurance, you will pay for 30% for healthcare services while your insurance picks up 70%. This will happen until you reach your out-of-pocket maximum, in which case insurance will cover 100%.
Here is a great summary video of some of the above info: https://www.youtube.com/watch?v=sBxLmKBqa60
Okay, clear as mud? Hopefully this post helps someone out there understand some insurance benefit lingo a little bit better. While I generally support the idea of transforming the healthcare industry into a more consumer-driven market, there is much work to do in empowering people to be able to be true consumers of healthcare.
Thanks again for all of the #WellfieWednesday support, be sure to post your pictures this week and tag the WW crew members in your post (@TheFuelPhysio, @Eric_in_AmERICa, @AaronPerezPT, @DianaKlatt, @kuhnalyssa_spt) and keep the wave of healthy change going!
- WW Crew