The cost of a health insurance policy goes beyond simply the monthly premiums. Deductibles, co-pays, and co-insurance amounts should all be included in the calculations when determining what you should actually expect to pay each year on top of the premium amount. When comparing health insurance quotes, be sure to factor these other costs of health care in so you are certain you’ve chosen the best option.
How Often Do You See The Doctor?
Most insurance plans require that you pay a set amount, known as a co-pay, each time you see the doctor. If you have a lot of regular doctor visits, such as when you are pregnant or in treatment for a particular condition, your copays can add up quickly. When comparing health insurance policies, determine the co-pay amount and estimate how many times you think you will see a doctor in the coming year. You can then calculate your co-pays for the year.
What Is The Policy Deductible?
Many policies carry a deductible, which is the amount you will be expected to pay out of pocket before the full terms of the policy kick in. A larger deductible can mean a lower monthly premium and vice versa. You will need to decide whether you would rather pay the extra amount on a monthly basis, or pay the deductible bills as they come, which could be in one large chunk in the case of a hospitalization. You should also bear in mind that each person on the policy will likely have to meet their own deductible amount.
Is There a Co-insurance Amount?
In order to bring premiums down, some plans use a co-insurance option, which is usually calculated as a percentage of the medical bills that you will be expected to pay out of pocket. For example, if you have an 80/20 coinsurance plan, your insurance company will pay 80% of the bill, and you will pay 20%. Again, try to estimate how much medical care you think you will need to get an idea of how much you might pay out of pocket.
The Out Of Pocket Limit
Just as it sounds, the out of pocket limit is the maximum amount you will be required to pay out of pocket for the year. If you have added up all of the co-pays, deductibles, and co-insurance amounts for the year, and it comes out above this amount, then you have a pretty concrete idea of what you will pay for health care that year—the premiums, plus the out of pocket limit amount.
For those who see the doctor rarely and are in good health, it is often a good financial choice to take a policy with a high deductible, large co-insurance percentage, and larger co-pay amounts. If you anticipate more health care needs, you might be better off with a higher monthly premium and lower out of pocket limit.