Health Insurance: Learn to Speak "Insurance"

Sometimes health insurance speech can be a complete foreign language to most people. Often these not-so-simple terms can mean a misunderstanding later when claims need to be filed or bills are received. Getting a good grasp on the language used in your health insurance policy is imperative to finding out if it is the right plan for you and how much your plan will cost you.

There are some very common terms that, once they are understood, can make navigating your way through your insurance policy universe much less painless.

The first term common in health insurance policies is DEDUCTIBLE. A deductible is the amount of money you would have to pay before the insurance company will cover costs. This amount is usually renewed yearly when your insurance policy renews itself. Also, policies sometimes have individual and family deductibles, and these amounts are often different. Read your policy closely, though, because many items and services do not count toward the deductible, like regular doctor visits and prescriptions.

Another common term is CO-INSURANCE, which is the same thing as CO-PAYMENTS or CO-PAYS. This is the amount that needs to be paid by you beyond the deductible. A common example of a co-pay is when you visit the doctor and have to pay a small amount (usually ranging between 10 to 30 dollars). Another example is the amount you pay for your prescription when you pick it up. The co-insurance usually does not count toward the deductible, but check your health insurance policy for details.

OUT-OF-POCKET MAXIMUM is a term used to refer to how much you have to pay that is not covered by your health insurance. This refers to all co-payments, co-insurance, and other uncovered items, and an insurance company will usually put a maximum amount of how much you have to pay each year. Premiums are not usually included in this amount. There are also other items and services that will not count toward your out-of-pocket expenses, so read over your policy carefully.

Another maximum amount is called the LIFETIME MAXIMUM, which is the total amount the health insurance company will pay, over your entire lifetime. Look closely at the lifetime maximum amount, especially if your policy is covering your family, as the totals can be different for an individual versus an entire family.

EXCLUSIONS are items that the policy will not cover. This includes items such as cosmetic surgery, comfort items, and reproductive issues. For instance, if you want to buy a whirlpool for your aching knees, you insurance policy probably will not cover it. Read your policy closely to find out what items it does and does not cover.

A very important term to learn is PRE-EXISTING CONDITIONS. These are diseases or disorders that you may have suffered from or have been treated for prior to becoming insured by this particular policy. Ask questions about your how your insurance policy covers these conditions, as they may exclude them completely or you may not be covered for those conditions for a certain period of time.

COORDINATION OF SERVICES is another common term you will find in your policy. What this means is if you have two or more sources of coverage for your condition, then they will not cover it all. They will work with the other source to pay for services appropriately. For instance, if both you and your spouse have health insurance, the companies will not double pay for your services. Therefore, they coordinate with one anther to determine how much each company will pay toward your health care.

Finally, GRACE PERIOD is a term you should be familiar with, especially when you first sign up for your insurance. This is the time period you have to pay your insurance premium before your insurance is cancelled.

A basic understanding of these terms will make you more familiar with what your policy means, and if it is the appropriate policy for you and your family.

Health Insurance: Learn to Speak "Insurance"

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