In simple terms, a network refers to the doctors, health care providers, hospitals, and health care facilities that are part of your plan. Save money by staying in your plan’s network For example, if your premium is $300 per month, the total for the year, $3,600, is not reflected in the out-of-pocket maximum. Premiums are not included in a health insurance plan’s out-of-pocket maximum, so be sure to factor this in as you compare the costs of various health plans. (In some cases, employers pay a portion of the premium.) If you get your insurance through your employer, the premiums may be automatically deducted from your paycheck. Why? Because you need to think about your total out-of-pocket costs when choosing a plan.Ī premium is a dollar amount you pay for your health coverage, usually monthly or biweekly. We tend to focus on premiums when shopping for a health plan, but the plan with the lowest monthly premium may not always be right for you. Premiums are part of the cost of health insurance You need to keep all of these things in mind as you calculate your true out-of-pocket costs. So, in general, a copay is what you pay up front, while coinsurance is what you pay later.Īdded together, the annual deductible, copays, and coinsurance make up your out-of-pocket maximum, the total amount you could pay for covered health care during the year. You’ll also receive an explanation of benefits (EOB) from your health plan that describes the charges you’re responsible for. With coinsurance, the health care provider will usually send you a bill, and you’ll pay the doctor or clinic directly. If your plan’s coinsurance is 20 percent, you’ll pay $20, and your insurance will pay the rest. Let’s say you visit the doctor after you’ve reached your annual deductible, and the cost of the visit is $100.
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