Health Insurance: Payments & Fees |
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Health insurance
services and premiums are a major expense for most families in the US.
In recent years the average increase in cost was over 10% every year.
As a result insured pay more for premiums, services and drugs. Employers
tend to shift their cost to the employees as well as terminating coverage
for high priced services.
It is very
important to confirm coverage before seeking health services; otherwise
the insured may be liable for very high medical bills.
These are the payments
and fees associated with the health insurance:
Health Insurance Premiums: The Cost for the Health Insurance
For group
health insurance members a payroll deduction may be available. This payment is deducted
pre-tax. Employers/Group administrators may pay portion of the premium
as a benefit to the group member.
For individual
health insurance members: A monthly premium is required to the insurance company. Good
health insurance plans for a family may cost as much as $1,000 a month.
Deductibles
The amount
that insured pays every time that he/she seeks a service. The deductible
is based on a fee schedule and could be anywhere from $5-45 for doctor's
office visit, to $30-100 for hospital’s emergency room.
In some health
plans the insured has to satisfy the deductible amount before the insurance
pays its share. This deductible amount may be $500-2500 for individual
and $5000 or more per family each calendar year.
Co-Insurance
The share
the insurance company covers after the deductible amount is met. As an example
the health plan is 80/20 with $25 deductible. After the insured pays the
$25 deductible, the insurance company will pay 80% of the rest of the cost. The
insured is liable for the additional 20%.
Prescription
Drugs
There are a variety of ways for the insurance companies to charge for drugs.
One common way is to define 3 groups: generic, medium level and Brand.
For each group there is different price.
Another common
practice is to charge a percentage of the drug’s cost.
Maximum Health Plan Benefits
Each health
plan has a “maximum life benefits provision”. This is the
maximum amount that insurance companies may be liable for the entire length
of the plan.
Fee
Schedule
The negotiated
amount that insurance carriers pay to the health providers for their service.
Deductibles and co-insurance payments are based on this fee schedule.
Patients
may pay significantly more for the same service if not covered by health
insurance.
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