Did you know that only 14% of people are able to answer 4 basic questions about health insurance? Becoming an expat means that you will probably have to get new health cover, so for the 86% of you that do not understand we put together a list with 10 important terms and tried to explain them in an easy way.
Allowable charge
The maximum amount your insurance provider thinks is normal to pay for a certain service. Imagine that you go to the doctor to get something checked and they charge $150 – when your insurance company says that $120 is the ‘allowable charge’ the doctor will have to accept this. When the doctor is an in-network provider you will not be charged for the excess amount, but when he is an out-of-network provider (see down below) there is a possibility that you will be charged.
Benefits
Literally the benefits of your health care plan. It is a list of the covered services and providers that you get with the plan of your choice.
Claim
When you ask your health insurance company to pay for medical costs that were made. E.g. you have to get an x-ray, which is fully covered by your health insurance and costs $500. The ‘claim’ would be asking your insurance company to pay the $500. If you are covered under your employer they will take care of this.
Copayment / Co-insurance
Your insurance provider may ask you to pay a certain fee when you use a service that they cover. E.g. you pay $10 out of your own pocket every time you visit a doctor or get prescription drugs. When this is a fixed amount it is called a copayment; when it is a percentage they call it co-insurance.
Deductible
The amount you must pay out of your own pocket before your insurance starts paying. E.g. you break your leg and the costs at the hospital are $1000. If your deductible is $400, you will have to pay $400 and your insurance will pay the remaining $600.
Dependent
A dependent is anyone who is covered by your health insurance policy. This could be your kids, your partner or both.
Drug formulary
The list of prescription drugs that are covered by your insurance provider.
In-network provider / Out-of-network provider
When a health service is an in-network provider it means that they are part of your insurance company’s network. Opting for these services instead of out-of-network providers can save you money, since in-network providers offer discounts as your insurance company sends more patients their way.
Payer
The employer, insurance company or any other third party that pays for your medical costs.
Premium
The cost of the health care plan that either you or your employer pays. It is like the subscription cost you pay for your phone.
You see, it is not that hard! Are you part of the 14% and fluent in health insurance jargon or do you struggle sometimes, just like the other 86%?