When buying a health insurance plan, understanding its deductible is very important. What is a health insurance deductible? It is a certain amount of medical expenses you must pay out-of-pocket before your medical health insurance picks up the tab. Most health insurance plans have an annual deductible, meaning that you will have to fulfill the deductible all over again the following year. Many family health insurance plans have family deductibles, as well as individual deductibles.
How do deductibles work? For example, if you have a certain deductible that must be fulfilled for surgical coverage, that entire amount must be paid within one year in order to begin receiving health insurance coverage for it. If the surgery costs less than the deductible, your health insurer pays nothing; but if its cost is more, they will pay a portion of the remaining amount. The exact amount your health insurance company will pay depends on the co-insurance percentage specified in the terms of your health insurance’s policy.
Preventative care, such as regular doctors’ visits, tends to be excluded from deductibles. Instead, it is subject to either a specified co-payment amount or a co-insurance percentage of the fee for the service. In addition, different types of services usually have separate deductible amounts: spending in one area does not count towards fulfilling the deductible in another. Also remember that there may be a smaller deductible for in-network care than the one that applies to out-of-network providers.
There are a variety of affordable health insurance options available with different deductible levels. Common deductibles offered range from as little to $500 to $10,000 or more, with most in the $1,000 to $5,000 range. A lower deductible usually results in higher health insurance quotes.
Which health insurance deductible is right for you? High-deductible health insurance plans are best for those in good health looking for cheap health insurance. Health Savings Account plans will even allow you to pay deductible with your pre-tax income. Older, less healthy people (including those with pre-existing conditions) may find a more comprehensive health insurance plan with lower deductibles better suited to their needs. In those cases, the higher health insurance premium may be offset by the out-of-pocket cost savings.
