To get the most benefit from your medical insurance policy, make sure you know your plan benefits and the amounts you will be responsible for paying.
Each medical insurance policy is an agreement between the insured and the insurance company. Each policy stipulates which services and diagnoses are covered. Under covered services, the policy defines which services and diagnoses apply toward copayments, coinsurance and/or deductibles. Some services may be denied because the diagnosis is not a covered benefit. An example of this is an office visit due to infertility or weight management. Many but not all policies do not consider these types of diagnoses medically necessary.
With the number of policies available, it is impossible for a physician’s office to know what each plan covers without contacting the insurance carrier. Along with providing benefit information to a health care provider, insurance companies also inform the provider that a quote of benefits and/or authorization does not guarantee payment. Our office verifies patients’ benefits as a service to our patients because we understand that trying to understand an insurance policy is overwhelming for most individuals, but we are at the mercy of the information given to us by the insurer.
Some terms to understand-
- Monthly Premium- the amount the insured pays each month to stay active on the policy.
- Copayment – a fixed amount paid for a health care service, test or prescription at the time received. These payments may or may not apply to an insured’s deductible or total out of pocket. Check your plan to see how copayments are handled.
- Deductible – the amount an insured pays for health care before health insurance begins paying. Typically there is an individual deductible and a family deductible when more than one person is covered on the plan as well as a higher deductible for out of network providers or facilities. You should always make sure your providers and the facilities (hospital, surgery center, etc.) are in network prior to services being rendered.
- Coinsurance – the insured’s share of the cost of health care services after the deductible is met. It is usually stated as a percentage, such as 80/20. With 80/20 coinsurance, after the deductible has been met in full, insurance will pay 80% and the insured will pay 20% up to the maximum out of pocket.
- Maximum Out of Pocket – the maximum amount an insured will pay between deductible and coinsurance. Copayments may or may not be considered in maximum out of pocket.
- In Network- insurers negotiate rates with certain providers or health care facilities and consider these providers in the plan network.
- Out of Network – any provider or health care facility which the insurer has not negotiated rates with is considered out of the plan network. The insured will have a higher financial responsibility for out of network providers.
A simplified example to illustrate how copayments, deductibles, coinsurance and maximum out of pocket work is as follows. Say a patient has a problem, schedules an office visit with a physician with an allowable charge of $150 and will need a surgery with allowable charges of $25,000 between an in network surgeon, anesthesiologist and the hospital. A patient with a plan that has a $50 copayment, $1,000 deductible, 80/20 coinsurance and $5,000 maximum out of pocket would pay a total of $5,050. She would pay her $50 copayment for the visit to the physician. For her surgery she would pay the $1,000 deductible and then $4,000 in coinsurance.
If contacted by an insurance company to provide additional information, be sure to respond in a timely manner. A covered service may be denied if the insurance company needs an insured’s updated information and the insured does not respond in a timely manner. If an individual is covered on more than one insurance policy, the insured should verify with the insurance companies which policy is primary. An insurance company may reject a claim and leave the amount to the insured’s financial responsibility if the correct insurance is not filed first.
For plans that fall under The Affordable Care Act (The Act), preventative services (as defined in The Act) are covered by the insurance company at 100%. However The Act does not specify every service that medical boards consider as preventative. For example certain lab tests that OBGyns consider routine annual well woman tests are not listed in The Act and insurers may leave the cost of those particular tests to the policyholder’s copayment or deductible. Not all plans fall under The Act.
Be your own advocate. If you need medical care other than preventative care, it is a good idea to contact your insurer to learn if the needed care is covered. Ask your health care provider for the CPT and/or diagnosis code that will be used before you call. Compare the information you obtain with that given to you by your physician’s representative. When speaking with your insurer be sure to document who you spoke with, the date, time and reference number for the call as well as the information that you are given. If the insurer tells you the care is covered and later denies it, the information you originally received can help with your appeal.
As a doctor’s office, we do our best to ascertain if services and procedures will be covered, including how much will be left to deductibles, coinsurance, etc.; however, sometimes the insurer does not allocate payment as they originally stated. We make every attempt to get claims paid properly however, we are not always successful. When patients also contact the insurer, we find it is usually helps speed up the process.
We are here to provide you the best health care possible and we do everything within our power to assure the claims we file are paid accurately.