Insurance Basics: Understand Your Insurance Plan

Does navigating your insurance feel like learning a new language? You're not alone! Insurance terms can be confusing, but we’re here to make them simple so you can focus on your health. In this article, we’ll explain insurance basics to define common terms and types of plans. We're here to help you make an informed decision and understand your insurance plan.

• Premium: The fixed amount you pay every month to maintain your insurance plan, even if you don’t use healthcare services that month.

•  If the monthly premium is not paid, the insurance policy will be canceled. 

• • • When shopping for your insurance plan, a lower monthly premium is not necessarily better in the long run. Some plans with a lower monthly premium may have a higher deductible that needs to be met before they will start covering the majority of services. 

• Deductible: The total amount you pay out of pocket before your insurance starts covering services. For instance, if your deductible is $1,500, you’ll pay all costs up to that amount before your coverage kicks in.

• • • https://www.healthcare.gov/glossary/deductible/

• Copay: A copay is a flat rate that you might pay towards healthcare services (typically once your deductible is met.) This amount is set by the insurance company and may change year to year. For example, if you visit the doctor and your insurance company allows $150 to be billed for the services you receive, you would pay a copay that might be anywhere between $20 and $80. Then, your insurance plan would cover the rest of the cost. 

• Coinsurance: A coinsurance is the percentage of a covered healthcare service you must pay after your deductible is met for the year. This amount is predetermined by your insurance plan. Your insurance plan will likely have a higher coinsurance amount if your deductible amount is lower. You will be responsible for paying the co-insurance amount once your deductible is met unless you reach your out of pocket maximum amount. 

• • • In the previous example, the allowed amount billed by your doctor’s office for services is $150. If your deductible is met and you have a 20% coinsurance, you will pay $30 for the visit, and your insurance will pay $120. 

• Out of pocket maximum: The out of pocket maximum is the total amount you are responsible for paying for healthcare services before your insurance plan will cover 100% of covered services. It differs from a deductible in that you must pay your deductible before your insurance will start paying for healthcare costs, whereas the out-of-pocket maximum is the highest amount you would be responsible for paying for healthcare services. It is important to note that each time you pay your copay or coinsurance, you are paying towards your out of pocket maximum. 

• Billed amount: The billed amount is the amount of money your healthcare provider bills for services. 

• Allowed amount: The allowed amount is the amount of money your insurance plan agrees to pay for covered healthcare services. The allowed amount is usually contractually predetermined between the provider and the insurance company. 

• • • https://www.mdclarity.com/glossary/allowable-charge

• Network: A network is a group of providers, doctors, and hospitals that are contracted with an insurance plan to provide care to its members. An insurance company may have different networks for different tiers of its insurance plans. 

• In-network: Your insurance company has a contract with your provider to offer healthcare services at a pre-negotiated rate. 

• Out of network: Your insurance company does not have a contract with your provider. Some insurance plans may still offer some coverage for services rendered by an out of network provider (out of network benefits). 

When you make your first appointment with us, we will ask you for the name of your insurance plan and your member ID. Our dedicated insurance team will contact your insurance to check your benefits for physical therapy (how much coverage your plan offers for physical therapy services). 

We will then contact you prior to your first appointment to let you know about the cost of your physical therapy visits. Each insurance plan can vary in terms of how much coverage is offered for physical therapy services, so we make sure to contact your insurance directly in order to get the most accurate information. The cost of your physical therapy visits is determined by your insurance company based on the contracted rate. 

We are contracted (in-network) with most major insurance companies, but if we do not have a contract with your insurance company, we will work with you on a solution that works best for you. Our self-pay option is $130/visit. We can also provide a superbill for you to submit to your insurance company for reimbursement if we are not contracted with your specific insurance company. 

If your insurance requires any additional information or authorization forms prior to starting physical therapy, our insurance team will handle this process for you so you can start care with us without the hassle of extra paperwork. 

Confused about your insurance? Let us help! Schedule your first appointment today, and we’ll take care of the rest. You can also contact us at any time with questions about how to understand your insurance benefits.