A health insurance premium is the amount you pay, usually monthly, to maintain your health insurance coverage. If you have health insurance through your employer, your premium is usually deducted from your monthly pay check. Typically your employer will pay for a portion of the premium. Costs that go beyond the monthly premium can be deductibles, co-pays, or coinsurance.
A couple of key points to keep in mind with health insurance premiums. When your deductible is higher, on average your premium will be lower. And vice versa, when you have a lower deductible, you will more than likely have a higher premium.
What is a deductible in health insurance?
A deductible in health insurance is the amount you pay towards a medical bill before your insurance starts paying claims. Unlike other deductibles like auto, home, or renters, where you don’t really get services until your deductible is paid, a lot of health insurance plans will provide benefits before you meet your deductible. Most if not all market plans will cover preventive care. Immunizations, screenings, and other preventive services are covered without paying your deductible. There are other benefits like doctor visits and prescription drugs that many health insurance plans will provide before you have met the deductible as well.
How do health insurance deductibles work?
Now that we know what a deductible and a premium are, we can look closer at how it works.
If your health insurance plan has a deductible of $2,000. You will pay 100% of all eligible health care expenses until the bills meet a total amount of $2,000. After this point, you’ll start to share the cost with your plan by paying coinsurance.
Coinsurance; is the percentage of costs of a covered health care service you pay, after you pay your deductible. For example say your health insurance plans allowed amount for office visits is $100 & your coinsurance amount is 20%. If you have already paid for your deductible: You only pay 20% of $100, which would be $20.
What is private health insurance?
Private health insurance is insurance offered by a private entity, like an insurance broker, or an agency. Private health insurance is not offered by the state or federal government. A few private health insurance options available are marketplace plans, group health plans through an employer, private health plans offered by licensed agents.
How to choose health insurance;
Like any insurance, you want to check your options. Create a side by side comparison of your top 5 options and choose what you thinks best. The easiest way to do this is to speak to a professional. We have professional health insurance agents that can answer all of your questions and help you shop for the plan that’s right for you.