Understanding deductibles, co-insurance and plan maximums
Benefit plans typically do not pay 100 percent of eligible expenses. It's quite
possible that you may be required to pay a small portion of eligible expenses under
your benefit plan as a result of deductibles, co-insurance and plan maximums.
What is a deductible?
A deductible is a flat dollar amount you must pay before the insurer will begin
making benefit payments. Most insurance talks about “satisfying the deductible”
– in plain language this means you have to pay this amount before any reimbursement
for benefits takes effect.
Everyone has heard of a deductible associated with a claim for a car accident. Just
like you would be responsible for paying the first $500 of your car insurance claim
for damages, your health plan may require you to pay the first portion of the payment
for your health insurance expenses.
Deductibles can apply to coverage for the entire plan, across certain benefits,
or a combination of both. Be sure to consult your plan booklet or CARESnet for specific
information related to your plan.
What is co-insurance?
Co-insurance, or co pay is a percentage portion of the total cost for a health and
dental services or products that you would be required to pay in excess of your
deductible. Where the deductible is a set dollar amount you must reach, the co pay
occurs for every expense.
A typical co-insurance percentage (the amount you would be responsible for) is 20
percent, meaning the plan would pay 80 percent of the expense; however certain benefits,
such as major dental and orthodontic coverage, may have a higher co-insurance.
Each benefit plan is unique and not all have the same co-insurance percentage. It's
best to consult your booklet or CARESnet for specific information related to your
plan.
There are many ways for plan members to reduce their out-of-pocket expenses. Learn
more about how you can decrease the amount you pay in getting the most out of your
benefit plan.
What are plan maximums?
Benefit plans sometimes place dollar limits, or maximums, on certain benefits and
services in a specified time period. Maximum amounts can apply to the total amount
of claims that may be paid during a plan year or even over the course of a person's
lifetime.
Maximums vary across every benefit plan. CARESnet will show you benefit plan usage
and eligibility providing you with information about any maximums that apply to
your benefit plan.