Health Insurance 101

It’s about that time of year again when most of our insurance plans restart or change. We thought we would discuss the different types of insurance plans offered in layman’s terms.

Insurance Terms:

•  Deductible: This is the amount that you are responsible for paying before co-insurance or sometimes co-pays kick in. Example would be you have a $1000 deductible and after that 20% co-insurance kicks in. You would be responsible for the first $1000 of healthcare costs so that may be a few doctors or physical therapy visits or if you received an expensive test like an MRI. Typically the smaller deductible the large the insurance premium.

1. Individual Deductible: Each family member has an individual deductible. The family has a deductible, too. All individual deductibles funnel into the family deductible.
2. Family Deductible: The family deductible can be reached without any members on a family plan meeting their individual deductible. Once the family deductible has been met then the individual deductibles no longer need to be met. There are some exceptions to this where some insurance providers do require everyone to reach their individual deductible first. 

•  Co-Insurance: This is the percentage of costs of a covered health care service you pay. This kicks in after your deductible has been met. Using the above example, if you met your $1000 deductible and now 20% co-insurance starts. So if a doctors visit is $100, your responsible for $20.
•  Co-Pay: This is a set rate you pay for a doctors visit, specialist visits, prescriptions and other types of care. Example would a $30 co-pay to see your doctor. You would not be responsible for reaching your deductible first, although on occasion there are plans that do want you to reach your deductible first. Plans tend to be a little move expensive. 
•  Out of Pocket Max: This is a cap, or limit, on the amount of money you have to pay for covered health care services. If you meet that amount you are covered at 100% so you will not owe the providers anything, the insurance company pays the full amount. Using the above example, you met your $1000 deductible, your co-insuance was 20%, which you paid until you hit your out of pocket max of $3000. After $3000 you would not owe the provider anything. 
•  Hard Max: number of visits your insurance plan will cover for a specific service (i.e. Physical Therapy). Once this number has been reached, your insurance plan will no longer cover those specific services. Example 60 visits per year for physical therapy services. 
•  Soft Max: Usually has a pre-selected number of visit coverage before the provider needs to prove medical necessity to continue service being rendere
•  Premium: This is the amount paid by you per paycheck or month to keep your insurance plan active.

HMO (Health Maintenance Organization)

HMO’s use their own network of doctors, hospitals and other healthcare providers who have agreed to accept a negotiated payment with the insurance company, which is typically less than other insurance plans. You would select a PCP (primary care provider) who you would need to see and get referrals to any specialists. 

Pros:

•  Lower Premiums
•  Lower deductibles, co-insurance and/or co-pays

Cons:

•  Limited to a smaller group of providers
•  Unable to go outside of the network to see specialists 
•  No non-emergency coverage of the network

Typically for outpatient physical therapy services through an HMO you would have to go to the hospital associated with your HMO. There are some large corporate PT practices that also can afford and are contracted to take HMO patients. 

PPO (Preferred Provider Organization)

This is the most common plan offered. There can be different PPO plans, ones in smaller networks and ones in larger ones. Typically the smaller the network the less expensive the plan, but you are also restricted with some providers. It is important to check if you are In-network or Out-of-network. Providers will sometimes say they accept all insurances, but that does not mean that they are in-network. Make sure to always ask if they are in or out of your network.

Pros:

•  No need to select a PCP, so freedom to choose any doctor
•  A referral is not necessary to see a specialist (example would be physical therapy)
•  Typically there is out-of-network coverage

Cons:

•  Higher premiums
•  Typically higher deductibles, co-insurance and/or co-pays

High Deductible Plans or HSA Plans:

These plans have a set amount an individual must pay before insurance starts to cover services. A high deductible plan (HDHP) can be combined with a health savings account (HSA), allowing you to pay for certain medical expenses with money free from federal taxes. Some of these plans cover services at 100% once the deductible has been met . 

Pros:

•  Having an HSA allows tax free money to be saved or used towards medical expenses. 
•  These plans tend to have lower premiums

Cons:

•  These plans have higher deductibles and out of pocket maxes

Self Pay Plans:

Typically less expensive than going through insurance, depending on your plan. Self Pay is cheaper because payment is required up front and the cost of having to pay a person or company to bill your insurance is not required. If you do have insurance this amount will not be applied to your deductible. 

Pros:

•  Typically cheaper rates
•  Can use HSA or FSA money to pay for services

Cons:

•  Does not apply to an insurance deductible

Overall, Health Insurance can be very confusing and what we discussed above isn’t always the way all plans work. Our advice is to always register online with your insurance provider and follow the exact details of your plan. I would also recommend calling your insurance company about a specific benefit or procedure. From the providers perspective we don’t always get accurate information ourselves, which is why we always recommend following up with your insurance provider too. We are happy to help you with any insurance questions or recommendations. Dynamic Physical Therapy tries to be as front as possible about what your benefits are prior to your first appointment.

Please feel free to reach out to us at info@dynamic-pt.com or call us at 312-643-1555 for any questions about insurance or if you would like to set up an appointment today.