What do I owe? It’s so confusing, I don’t understand.
If you get a bit tripped up understanding the insurance lingo and struggle to understand what your financial responsibility is and why, you are not alone! Usually the portion of the payment for which the patient is responsible is either the deductible, coinsurance or copay.
A deductible is an amount set in the insurance contract that is paid in full prior to the insurance company paying some or all of the payment to your healthcare provider. The amount of deductible varies widely between policies. On the low side a deductible may be $150. High deductible policies could have upwards of $6000 per policy year.
A typical policy with a deductible will also require coinsurance once the deductible has been met. The coinsurance amount is a percentage of the allowable payment for the visit procedure. To simplify the example, let’s say that the reimbursement to your physical therapist for your treatment is $80 each visit. (This is purely an example, as most visits are based on the reimbursement of therapy procedures during each visit and the amount may vary depending on treatment. Some insurance companies may have a flat reimbursement rate contract with a provider.) Following the example, if you have a $1500 deductible, you will owe the full amount of the therapy visit, in this case $80, until the deductible has been met by any of your medical visits which apply to your deductible. So, any doctor’s visits, specialist visits, diagnostic testing, urgent care visits, etc. will all go toward your deductible per your insurance policy. If you owe a coinsurance after reaching your deductible, then you would owe that percentage of the visit versus the whole reimbursement amount. So, to follow our example, if you have a 20% coinsurance, once your $1500 deductible has been met, you owe 20% of the reimbursement for your therapy visit. In our example that would be 20% of $80 or $16 per visit.
The last form of patient responsibility, the copay, tends to be more straight forward than coinsurance. Copays are a flat fee owed at each visit. The copay owed may vary as to whether you are seeing your primary care physician or a specialist. Copays usually are not tied into a deductible.
It’s always advisable to verify your benefits with your insurance company so you don’t end up with any surprise expenses. Don’t hesitate to ask for clarification from your insurance company with your questions and concerns.
Kristen Pagano, Administrator