Ten Things to Know About Health Insurance Deductibles

A health insurance deductible is the amount you pay out of pocket for your medical expenses before the insurance company starts applying your benefits and paying for your medical claims.

Female Doctor Using Digital Tablet Talking With Patients
Female Doctor Using Digital Tablet Talking With Patients

  • Your deductible has to be met yearly.
  • Plans with a higher deductible tend to have a lower monthly premium whereas plans with a lower deductible have a higher monthly premium.
  • The cost of medical treatment out of pocket prior to meeting your deductible is still less than the actual cost of treatment without insurance coverage. (Bottom line: it’s less expensive to have health insurance than to go without).
  • Insurance plans will still offer some benefits to you before you reach your deductible.
  • All health insurance plans must cover preventive care despite whether you’ve reached your deductible. (Find out what is considered preventative care here)
  • Paying your deductible counts towards your out of pocket maximum (OOPM). The maximum out of pocket costs for individuals in 2014 is $6,350 while the maximum out of pocket costs for families is $12,700.
  • “Before Deductible” means that the medical provider will cover the treatment before you’ve met your deductible. (copays will still need to be made)
  • “After Deductible” means that you and the insurance carrier will start sharing the costs of treatment after you’ve paid your full deductible.
  • Some plans have a “deductible carryover” policy where any amount you pay towards your deductible within the last three months of the year is carried over to your plan the following year. This will help you satisfy your deductible sooner so you can utilize your plan benefits.
  • Some plans offer deductible credits. This means that if you change your health plan mid year, you’ll get a deductible credit worth the same dollar amount you’ve paid towards your previous plan put towards your new deductible plan.

Still have questions about how deductibles work? Want to know whether you should choose a higher deductible or a lower deductible? Feel free to give us a call and we’ll help you find the best plan for you, your business, or your family.

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