Drug Expenses: Out-of-pocket

Your “out-of-pocket” expenses

Understanding Cost sharing: 

The terms “cost-sharing” or “out-of-pocket costs” refer to the proportion of your medical bills you will be responsible for paying when you actually receive Health Care Insurance.  Keep in mind, that Cost sharing never includes your monthly premium.

These are the four cost-sharing terms you will see.

Copay

A fixed dollar amount you pay for certain types of care.

-       You might pay a $20 for a chiropractor’s visit and the insurance company will reimburse the rest.

-       Plans with higher premiums generally have lower copays, and vice versa.

Coinsurance

A percentage of the cost of your medical care.

-       For glasses that cost $500, you might pay 20 percent ($100). Your insurance company will pay the other 80 percent ($400).

-       Plans with higher premiums generally reimburse a larger portion of the bill.

Out-of-pocket limit

• The most cost-sharing you will ever have to pay in a year.  It is the total of your deductible, copays, and coinsurance (but does not include your premiums). 
• Once you hit this limit, the insurance company will pick up 100 percent of your costs for the remainder of the year.
•   Plans with higher premiums generally have lower out-of-pocket limits.

NOTE: Most people rarely pay enough cost-sharing to hit the out-of-pocket limit but it can happen if you require a lot of costly treatment for a serious accident or illness.

Plan with Deductible

The amount you pay every year before the insurance company starts paying its share of the costs.

-       If the deductible is $2,000, then you would pay cash for the first $2,000 in health care you receive each year, after which the insurance company would start paying its share.

-       Plans with higher premiums have lower deductibles, and vice versa.

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Drug Cost...Nothing matters more than your health!