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Insurance Coverage Explained

Insurance coverage can be a tricky thing to navigate. Do you know what your individual deductible is? If so, do you know about your family deductible and coinsurance for a specialist visit? For most of us, myself included, the insurance specifications have become seriously complex.  Many times I’ve intervened on behalf of patients that have met their wits-end while attempting to understand their chiropractic or physical therapy benefit coverage. In an attempt to simplify some of the frequently used insurance terminology, I put together this little cheat sheet to help in minimizing the frustration factor.

Co-insurance

A coinsurance occurs when there is cost-sharing between the insurance company and the covered member/family.  The insurance company may tell you that your responsibility is a 20% co-insurance and that they will cover the rest of the charges (remaining 80%).  Quite often a coinsurance comes in to play after an individual or family deductible has been reached.

Example: Your opthamologist visit is $400 and Optima informs you that you have a 20% coinsurance after meeting your $200 deductible.  Currently, you have met $0 of your deductible. Your responsibility would be: $200 of the deductible and then 20% of the remaining $200 specialist visit charge = $40.00. The total you can expect to pay for the visit is around $240.

Co-pay

A copay is a set fee that you are responsible for each time you visit a doctor.  There are usually tiers or copays where a primary care doctor is typically less than the copay you may have for a specialist. Some plans have a copay due in addition to a co-insurance.

Deductible

The set amount an individual or family must reach before transfering over to coinsurance coverage for medical services.  Some plans have relatively low individual and family deductibles of $200 – $500 while other plans have larger $5000 – $9500 deductibles.  Once you have met your deductible you may only be responsible for a fraction of the percentage of your medical care, referred to as a co-insurance.

Out of pocket maximum or stop loss

This is the absolute maximum a covered member or family will pay out of pocket for medical care including copays, deductibles and co-insurance for a defined period of coverage (usually a calendar or a contract year)