Understanding Key Terms under Your Health Insurance Policy

A few definitions can help you understand what you pay under your health plan and what your insurer pays.

Your health plan generates an explanation of benefits (EOB). It shows you how much they paid your provider and the amount you owe. According to the American Medical Association, almost 20 percent of EOBs contain errors, so review each EOB. If you don’t agree with or understand an EOB, contact your health insurer, not your provider. Your EOB statements arrive electronically or by mail.

Your deductible is what you pay before your plan begins paying your covered services. Submit all your treatments to your health plan to receive all the credit against your deductible.

You should monitor your maximum out-of-pocket (MOOP) costs. MOOP limits the amount per calendar year you pay for covered costs. You are always responsible for the entire cost of uncovered services. Acupuncture costs, for example, may not apply to your MOOP. And you are always responsible for your copays.

Your copay is the fixed amount you pay when you receive treatment. Seeing your primary care physician usually involves a lower copay than seeing a specialist. Urgent care centers impose lower copays than emergency rooms.

Coinsurance is the portion of the allowed amount on a covered service that you pay. The allowed amount is the limit your insurance sets for covered medical services. Once you’ve reached your MOOP, coinsurance no longer applies, although copays continue. Are you confused by a definition under your health plan? Call us.