Health insurance vocab
Keira McGuire | 01.15.14
By March 31, 2014, all Americans must have health coverage. Those who do not have coverage will face a penalty. Sounds simple enough, but health insurance can be confusing.
Here are some need-to-know health insurance terms so that you can make the most of your new plan:
Premium: The amount that you’ll pay for health insurance, usually on a monthly basis. You’ll pay this even if you didn’t have any medical expenses that month. Usually, you pay a lower monthly premium if you have a higher deductible.
Out-of-pocket costs: These are your expenses for medical care that are not covered by insurance. These include deductibles, co-insurance, and co-payments for covered services plus any medical care that isn't covered by your plan.
Deductible: This is the amount that you are responsible for paying when you receive medical services before your health insurance plan kicks in to help pay. So, if your deductible is $1,000, for example, that means that your plan will begin covering medical costs only after you've reached that initial $1,000 in expenses. For each doctor visit or drug that is prescribed, you may have a copayment or co-insurance.
Co-payment (co-pay): This is a fixed amount that you'll pay for a covered health care service, and it's usually paid at the time of that service. Usually, copays don't count towards your deductible. Co-pays vary by type of service. For example, a co-pay for a doctor visit might be $25, and $150 for an ER visit.
Learn more about how you can make the most of your new health plan in our new Getting Covered: The Affordable Care Act guide. This multimedia guide is designed to help individuals as well as small business employers in Pennsylvania understand changes under the Affordable Care Act and assess healthcare needs before shopping, explore health plans and learn how to access them.