With the considerable amount of companies offering health insurance in so many shapes and sizes, it is understandable why the consumer remains at a disadvantage when selecting coverage for them and their family members. Most comprehensive insurance plans contain the same types of coverage but there can be significant differences in how they are delivered and for how much money. The three main areas of concern with any comprehensive policy that needs to be investigated are:
Co-Pay
The co-pay in the insurance policy is the amount the insured must pay out of pocket before any benefits are paid for doctor visits. Also, the co-pay usually applies to different providers. For example the policy may requires a $35 co-pay for the primary doctor visit, a $60 co-pay for a visit to a specialist and a $100 co-pay for treatment in an emergency room or clinic. The consumer should determine these fees up front and take them into consideration before purchasing the policy.
Deductible
The insurance policy deductible is the amount the insured must pay out of pocket for certain services before the insurance company will pay benefits. Deductibles will typically apply to hospital stays, diagnostic tests and medical equipment. In today’s marketplace, many companies have elected to offer higher deductibles rather than substantially raising their rates. This is a typical marketing tactic that many industries use to soften the pain of price increases. The extremely high deductibles being offered in current insurance plans can potentially bankrupt a family in the event of a serious illness or injury. The consumer needs to be aware of their exposure and plan for it.
Co-Insurance
Co-insurance is the percentage of costs for a covered claim that is paid by the insured instead of the insurance company. For example, many companies offer an 80/20 split to help keep rates more affordable. This split however, means the insured is responsible for 20% of their medical costs and the insurance company is responsible for 80%. There is usually however, an out-of-pocket maximum for the insured that is stated on an annual basis. For example, your policy may pay on an 80/20 split but have a maximum out of pocket of $10,000. This means that once this maximum has been reached, the insurer will begin to pay 100% of expenses.
There are many insurance companies marketing many different flavors and sizes of insurance plans. The consumer should do the research before purchasing and better yet, get advice from a reputable and knowledgeable agent.
Co-Pay
The co-pay in the insurance policy is the amount the insured must pay out of pocket before any benefits are paid for doctor visits. Also, the co-pay usually applies to different providers. For example the policy may requires a $35 co-pay for the primary doctor visit, a $60 co-pay for a visit to a specialist and a $100 co-pay for treatment in an emergency room or clinic. The consumer should determine these fees up front and take them into consideration before purchasing the policy.
Deductible
The insurance policy deductible is the amount the insured must pay out of pocket for certain services before the insurance company will pay benefits. Deductibles will typically apply to hospital stays, diagnostic tests and medical equipment. In today’s marketplace, many companies have elected to offer higher deductibles rather than substantially raising their rates. This is a typical marketing tactic that many industries use to soften the pain of price increases. The extremely high deductibles being offered in current insurance plans can potentially bankrupt a family in the event of a serious illness or injury. The consumer needs to be aware of their exposure and plan for it.
Co-Insurance
Co-insurance is the percentage of costs for a covered claim that is paid by the insured instead of the insurance company. For example, many companies offer an 80/20 split to help keep rates more affordable. This split however, means the insured is responsible for 20% of their medical costs and the insurance company is responsible for 80%. There is usually however, an out-of-pocket maximum for the insured that is stated on an annual basis. For example, your policy may pay on an 80/20 split but have a maximum out of pocket of $10,000. This means that once this maximum has been reached, the insurer will begin to pay 100% of expenses.
There are many insurance companies marketing many different flavors and sizes of insurance plans. The consumer should do the research before purchasing and better yet, get advice from a reputable and knowledgeable agent.
I am an experienced insurance agent with over 20 years in the P&C and Life insurance industries. I have been an agency owner, manager, consultant and producer at agencies in Florida and Georgia. Since I read quite a lot, I consider myself knowledgeable in many different areas.
Sosteen517
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