What Does a Health Insurance Plan Cover?
There are different kinds of health insurance plans available, each type of health plan follows a certain schedule of benefits and coverages as agreed upon or mandated by the health insurance company. Whilst, Affordable Care Act (ACA) health plans cover pre-existing conditions and do not increase the rate or the premium based on health conditions or disease state, other insurance types like: Short Term Health Insurance Plans or Fixed Indemnity plans may not cover pre-existing health conditions.
While an individual health insurance plan cover the expenses incurred from medical services and prescription medications, there is a shared cost between the insured and the insurance company. These costs are determined in the health insurance plan’s SBC (Summary of Benefits and Coverage). It is important to read and understand the components in the health insurance plan SBC so you can make better decisions on which plan metal tier (Silver, Bronze, Gold) you would like to enroll in. In addition, the health insurance plan’s SBC helps you make a more educated decision on your health care services. In this blog will discuss all the components in the SBC, definitions, and an example of how it reflects on your healthcare costs.
Difference Metal Tiers and the Cost Sharing:
Plan Metal Tier
Health Insurance Plan Pays
Your share of costs for services that a plan covers that you must pay out of your own pocket (sometimes called “out-of-pocket costs”). Some examples of cost sharing are copayments, deductibles, and coinsurance. Family cost sharing is the share of cost for deductibles and out-of-pocket costs you and your spouse and/or child(ren) must pay out of your own pocket. Other costs, including your premiums, penalties you may have to pay, or the cost of care a plan doesn’t cover usually aren’t considered cost sharing.
Where to find the health insurance plan metal tier?
See the images to better learn where the Plan Medical Tier is located by the health insurance plan.
What is a Copay or Copayment?
A fixed amount (for example, $30) you pay for a covered health care service, usually when you receive the service. The amount can vary by the type of covered health care service. See image below to find where the copayments are usually listed on the health plan. In this example, the primary care visit is Free (no copay is required) and the Specialist visit is $30 copay per visit.
What is a deductible?
The deductible is the dollar amount paid by you before the health insurance plan starts paying for covered services. Some health insurance plans have lower deductible, as low as $0, and other plans have higher deductible (Bronze plans). Generally, if you anticipate using your health insurance plan extensively for medica services, then you would need a Silver or Gold plan that normally has lower deductibles. If you only use your health insurance plan for emergencies or just for your annual physical exam, then a high deductible plan may be a better fit for you. Higher deductible plans have lower premiums per month. You can always add a Fixed benefit medical plan to cover for the out of pocket costs or the high deductible.
What is a health insurance plan network?
The health plan network is set by the insurance carrier. The network determines what medical providers and hospitals are covered by the health insurance plan. Some health insurance plans do not allow for services to be covered by outside the network providers. Nonetheless, some health insurance carriers allow you to see doctors out of network but at a higher deductible or out of pocket cost. Always consult with your insurance agent or read your health insurance plan’s SBC before seeing out of network providers.
Some PPO health insurance plans allow you to see doctors out of your network subject to higher deductible and higher out of pocket costs.
Do Medicare Supplement Plans Have a Network?
No. Medicare Supplement plans or Medigap plans pay for the 20% of the Medicare covered services not paid by Medicare Part A and Part B. Note that Medicare Supplement plans do not cover prescription drugs. You need to enroll in a standalone separate Part D (Prescription Drug Plan) to get medications coverage,
Do Medicare Advantage Plans Have a Network?
Yes. Medicare Advantage Plans have a network of providers and hospitals that the plan would cover for services. Medicare Advantage plans have either HMO or PPO network. These plans work similar to individual health plans. Medicare Advantage Plans may have a deductible and Maximum Out of Pocket to meet annually. There are also Copays and Coinsurance that you may need to pay for services. Most of Medicare Advantage plans have prescription drug coverage included, so you do not need to purchase a separate Part D. In fact, if you have a Medicare Advantage plan, you can not enroll in a separate part D plan.