Health insurance terms explained

0:00- [Narrator] We're told your health insurance plan has the following features: deductible, $2,000 a year, copay, $40 per doctor office visit, coinsurance, after deductible, plan pays 90% of covered services. So they say your visit, you visit your in-network primary care doctor.

0:19After the visit, you get lab work and X-rays at an in-network hospital. When we talk about in-network, this is a list of doctors and hospitals that your insurance company has a partnership with in some form. They've created a network. And you get, in general, you're going to get a better deal when you go there because they probably negotiated deals with the service provider.

0:42The lab work and X-rays cost $2,000 in total. And just to go back to the in-network, that might, some of these numbers, things like copays or the coinsurance might be very different if you go out of network. But anyway, the lab work and X-rays cost $2,000. How much will you pay out of pocket for the visit?

0:59So that out of pocket just means what are you paying versus what the insurer's paying for the visit, lab work, and X-rays. So pause this video, have a go at it. All right, so let's just review what these words mean. Deductible, this is how much you pay out of pocket before the insurance actually kicks in.

1:19A copay is what you pay every time you have one of these scheduled types of visits. And they might have different policies for different insurance plans, and it usually does not go against your deductible. And then coinsurance is how much is covered after the deductible.

1:34So here, the lab and X-rays cost $2,000 in total. Well that's essentially all going to be before you've met your deductible. So this is all going to be out of pocket. So is the answer 2000? Well, on top of that, you have this doctor visit. And as we said, the doctor visit does not go towards the deductible.

1:55Usually, you're paying that no matter what. And here, it says $40 per doctor visit. So what you're gonna have to pay is the $2,000 for all of those, for all of that lab work and x-rays, plus the $40 copay for the doctor visit, which is gonna get us to $2,040. Now you might be saying, "Hey, this insurance wasn't so useful.

2:18I essentially just had to pay everything." Well, let's fast forward a little bit to later on in the year. So here, we're told later in the year you received the following care at an in-network hospital. And so there's all of these things that were done. How much will you owe out of pocket for this visit?

2:37So you could pause your video and have a go at that. Well, now we have met our deductible. This $2,000, and usually it resets every year, but we spent it for that year, so now our insurer will cover everything. So how much total is there? And, well, I shouldn't say everything.

2:56The insurance kicks in and we know the coinsurance is 90%. Let's go back up there to review that. We see that right here. After deductible, plan pays 90% of covered services. So assuming all of these are covered services, if we add up 2,500 to 1,500 to 500, that ends up being a total, let me just write total of $4,500.

3:22So if your insurance plan is gonna pay for 90% of this, you're gonna have to pay for 10% of it so you're gonna have to pay $450. And I don't see a doctor visit here, some of those things that would normally have a copay, so that's it, just the $450. If it said another doctor visit over here, a scheduled doctor visit or something like that, then I would've added another copay to that.

3:44So I would've added another $40, even though we've already met the deductible, 'cause usually the deductible, the copays are things usually that you pay no matter what.