Choosing a healthcare plan can be very difficult. There are all kinds of factors to weigh, and in the end, it can all seem like all of your options are too expensive. However, once you start to work through the heavy industry jargon, things start to get much simpler. The most important thing to understand is how deductibles work. Once you have a relatively strong understanding of what they are and the different options available to you, the right decision presents itself much more clearly. Here are 5 things you should know about health insurance deductibles.
With health insurance, you pay for your medical expenses two ways – with a deductible and with a premium. Your insurance deductible is a fixed amount of money you must spendbefore your insurance begins to pay. Your premium is the cost for your insurance plan, usually paid in monthly installments. These two forms of payment typically go hand in hand — a higher deductible often results in a lower monthly premium and vice versa.
When considering a plan with a higher premium versus a higher deductible, it is important to consider your anticipated annual medical expenses. If you are in good health, you can go for a higher deductible with lower monthly premium payments, but if you are in need of medications or any kinds of regular services, you want to keep your deductible low. Since 2014, the maximum you can be charged for a family plan deductible is $12,700, and as an individual, the most you can be charged is $6,350.Less than 30% of Americans pay more than a $3,000 deductible.
Depending on the services that you need, you can often receive those services before meeting your deductible. If you pay for renter’s, homeowner’s or auto insurance, you likely know that you’re required to pay your deductible in full before you are eligible to receive any services. However, when it comes to medical services, you can often receive a wide variety of services before you’ve paid your deductible, depending on the level of urgency.
Know that preventative care should always be covered. Before you decide to go with any particular plan, be sure to look into whether or not preventative care is covered by your premiums. Services such as immunizations, x-rays, screenings, and other forms of preventative care should all be covered. This is a very regular practice, so if you are considering a plan that doesn’t cover these services, you may want to think again.
On average, people without health insurance pay twice as much for care. Many people end up paying too much in emergency room visits because they don’t think they can afford their premiums or deductibles and try to get by without health insurance. This is definitely not the way to go. Even if you do have the maximum deductible to pay out of pocket for, you will still pay much less than you would without a health insurance plan because insurance companies negotiate rates with healthcare providers, which means that you will pay a discounted rate.