Glossary
Coinsurance
Coinsurance is your share of the costs of a covered healthcare service, calculated as a percentage (for example, 20%) of the allowed amount for the service. Your coinsurance will begin after you have met your deductible. For example, if the health plan’s allowed amount for an office visit is $100 and you’ve met your deductible, your coinsurance payment of 20% would be $20. The health plan pays the rest of the allowed amount.
Copay
A copay is a fixed dollar amount you pay for a healthcare service. The amount can vary by the type of service. Your copays will not count toward your deductible but will count toward your out-of-pocket maximum.
Deductible
The deductible is the amount you owe for covered healthcare services before your plan begins to pay benefits. For example, if your deductible is $2,800, your plan won’t pay anything until you’ve met your $2,800 deductible for covered healthcare services subject to the deductible. Preventive care is not subject to the deductible, as it is covered 100% by any medical plan option.
Embedded Deductible
If you are on a family medical plan with an embedded deductible, your plan contains two components: an individual deductible and a family deductible. Having two components to the deductible allows each member of your family to have your insurance policy cover their medical bills prior to the entire dollar amount of the family deductible being met. The individual deductible is embedded in the family deductible.
Explanation of Benefits (EOB)
An EOB is a statement from the insurance company showing how claims were processed. The EOB tells you what portion of the claim was paid to the healthcare provider and what portion of the payment, if any, you are responsible for.
Individual Mandate
Federal healthcare reform mandates most U.S. citizens have health insurance for themselves and their dependents. McGee Automotive Family helps you stay insured by offering affordable healthcare for all employees who work at least 30 hours each week.
In-Network vs. Out-of-Network
A network is composed of all contracted providers. Networks request providers to participate in their network, and in return, providers agree to offer discounted services to their patients. If you pick an out-of-network provider, your costs will be higher because you will not receive the discounts the in- network providers offer.
Out-of-Pocket Maximum
The out-of-pocket maximum is designed to protect you in the event of a catastrophic illness or injury. Your out-of-pocket maximum includes your deductible, coinsurance and copays that come out of your pocket. After you have paid the specified out-of-pocket amount during a policy year, the plan pays the remaining covered services at 100%.
Preventive Care
Routine healthcare services can minimize the risk of certain illnesses or chronic conditions. Examples of preventive care services include but are not limited to physical exams, mammograms, flu vaccines, prostate tests and smoking cessation.
Reasonable and Customary
The amount of money a health plan determines is the normal or acceptable range of charges for a specific health-related service or medical procedure. If your healthcare provider submits higher charges than what the health plan considers normal or acceptable, you may have to pay the difference.