Understanding Health Insurance

We are often asked for assistance from clients with understanding health insurance.

As with any service, a health care provider charges a fee for their services. Clients will choose to either pay out of pocket for services or allow their insurance companies to cover some or all of the cost of services, depending on their insurance plan benefits.

Below is a list of the many terms you may see or hear regarding insurance coverage:

Vendor
This is the insurance company who insures your policy. It is often offered through an employer or paid by an individual (individual policy)
Subscriber
This is the person who is the main policyholder. For example, if coverage is offered through an employer, the policyholder is often the employee. Coverage is often extended to the spouse of the employee and family members/children.
Co-Pay
This is the amount that the patient is required to pay a provider of service at each appointment. It is defined in the insurance policy. For example, the policy might state that the client pays $25 per session.
Deductible
This is the amount that the patient is required to pay a provider of service out-of-pocket beginning each new calendar year before the insurance company begins to pay. This amount is also specified in each policy.
In-Network Provider
This is a provider that has agreed to participate in an insurance network.
Out-of-Network Provider
A provider who is not participating in your network. Be careful to not immediately discount such a provider, as you want to select a provider that can best treat your problem or issue. Also, many insurance companies offer coverage to out-of-network providers.
Third Party Payer
Many times insurance companies farm out coverage to a specific network. That agency then handles claims processing and reimburses the providers.
Calendar Year
This refers to the calendar start- and end-dates of the policy. In most cases it runs from January 1st through December 31st, but not in all cases.

We hope that this helps to bring some clarity to those who posed questions regarding coverage and the terms involved.

We are always available to answer any questions you have.

We always encourage clients to be aware of their coverage plan, whether it is consulting your insurance provider, your plan booklet, or human resource consultant.


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