Health insurance is a necessity

Taking care of your health is key to remaining well and safe. The right, affordable health insurance ensures that you receive both routine and critical medical care at the time that you need it. Keep in mind that while health insurance substantially reduces your out-of-pocket burden for medical expenses, it does not eliminate that full burden.

Most medical care requires some degree of cost-sharing, meaning you must cover a portion of the expenses yourself. One of these personal costs may be your deductible. A deductible is a specific cost burden that will accompany certain medical procedures or services.

How does a deductible work?

A deductible is a fixed, yearly amount that you must pay for medical expenses before your health insurance will cover the remaining costs of care. Deductibles are designed to lessen the cost burden posed to medical insurers. By sharing some costs, insurers can continue to offer affordable premiums and more expansive coverage to all of their policyholders.

For example, suppose that your health insurance plan has a $3,800 annual deductible. This means that you will have to pay up to $3,800 out of pocket in a single year before your insurance plan will cover certain costs of care. After you have paid off the deductible, then your plan will cover additional eligible expenses. In this example, if you received a $6,000 surgery bill, you’d pay $3,800 and your insurance would cover the rest. Once your plan renews, the deductible obligation starts over.

Do deductibles apply to every medical expense?

Health insurance deductibles do not always apply to every medical expense. Some plans require you to pay 100% of the costs of care until you have met your full deductible.

Other medical care expenses are exempt from the deductible obligation, such as:

  • Regular checkups
  • Medically necessary services
  • Preventive care

For these exempt expenses, you may only have to pay the necessary copayment or coinsurance regardless of whether you still owe money on your deductible for a checkup, lab work, vaccination or other routine care. This enables you to still receive the care that is most necessary for you to stay well, without facing an undue cost burden.

Your deductible will often apply to certain care costs, such as inpatient care expenses, certain imaging services or other care that your insurer might not deem medically necessary. You can examine precisely how your plan outlines your own deductible obligations by reviewing your explanation of benefits document. This will outline exactly how and when the deductible will apply.

For further information on health insurance deductibles, log into your account!

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