Understanding your deductible

Most health plans today have a deductible.   A deductible is the dollar amount of your covered claims you are responsible for before your insurance will start to pay. Deductibles can operate differently from carrier to carrier and from plan to plan.    To help you understand your deductible, find out the answers to the following questions

What time period is my deductible calculated on? Some deductibles are tracked on a calendar year basis while others are tracked based on a plan year basis.  For example, if your health plan’s renewal date is April of each year with a plan year deductible, your deductible runs from April 1 to March 31 of each year.  Maryland small group plans run on a plan year basis while individual policies run on a calendar year basis.  This is especially important if you are a new employee to a plan with a plan year deductible.  If you are a new employee and your effective date is June 1, your deductible would start then.  If the plan year is September 1, your deductible would start over just three months later in September.  If you have purchased a Maryland individual policy with an effective date of August 1, your deductible would start then and restart January 1

How are the deductibles on family policies tracked?  Some plans require the entire family deductible to be met before claims are paid.  This is common for health savings account plans (H S A).  An example of this is if a plan has a $1500 individual deductible and a $3000 family deductible, for families, the full $3000 must be met before any claims are paid.  The $3000 can come from one family member or a combination of all family member claims.  Because of this, in a family of two purchasing a policy, we suggest that the policies are purchased separately so that the deductible can be tracked separately.

In other plans, one family member cannot contribute more than the individual deductible.  Some carriers call this an “embedded” or “stacked” deductible.  In our previous example, this would mean that if one family member reached the individual $1500 in claims, the insurance company would start to cover that family member’s claims.  This is a good feature for a family where there is one family member who incurs most of the claims.

What types of claims are subject to the deductible?  Affordable Care Act plans include preventive care as a covered in full benefit and not subject to the deducible.  Other than the preventive care, plan designs are unique.  Some plans impose the deductible for mainly hospital based services only.   These type of plans generally require just a copay for a visit to the primary care doctor or the specialist.   The copay you pay would not credit your deductible.  Other plans require that all services are subject to the deductible.  This is common in the HSA plan designs.  Check your benefit chart carefully which will show you what services are subject to the deductible.

Is there a separate deductible for prescriptions?  Some plans have a separate deductible for prescription claims and medical claims.   HSA plans have a combined medical and pharmacy deductible.  This is called an “integrated” plan.  In plans that have a separate pharmacy deductible, the pharmacy deductible is tracked per person in the family and may or may not have a family maximum.

Does my “out of pocket” maximum include the deductible?  The out of pocket maximum is the most you have to pay out of your pocket in the year before the insurance picks up 100% of your claims.   Most plans include the deductible amount in the presentation of their out of pocket number.  Some plans however, present the out of pocket maximum in addition to the deductible

Is there a separate  or combined deductible for in and out of network claims and do they count towards each other? For plans that have out of network benefits most have separate in and out of network deductibles which do not count towards each other.   It’s like having two separate health plans.


 

Posted on by Melanie Epstein in Insurance Basics Leave a comment

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