Some health insurance terminology, (badly) explained.
Obligatory disclaimer that I am NOT an expert, just a stubborn, sick bitch who has hands-on experience dealing with these vultures. If you're lost and confused by all these complicated terms, then I hope this little guide will help you squeeze as much money out of your insurance provider as you can.
If you have any questions or corrections, feel free to contact me at exeggcute.tumblr.com!
PDF version of this guide:
QUICK REFERENCE (TL;DR)
What you pay to keep your policy, usually a monthly fee (or, if you're on an employer-offered health plan, you'll pay a small fee out of each paycheck).
This fee is completely separate from other insurance costs—it doesn't count towards your deductible or out-of-pocket limit (which I’ll elaborate on in a bit), and if you stop paying your premium you'll lose your policy. You'll have to pay for the cost of actual care on top of the cost of your premium (which is why certain plans with really high premiums but poor coverage may not be worth it). You'll also have to pay for your premium regardless of whether you actually use your plan or not.
If you're someone who doesn't have a lot of health problems (and don't engage in risky activities that involve juggling flaming bowling pins while riding a unicycle), a plan with a low premium may be the way to go, even if the coverage it offers is lower, just because you may not be using your plan much. On the other hand, if you're someone who has a lot of health problems or visits doctors frequently, choosing a plan with a higher premium may save you money in the long run if it cuts down on associated costs (for doctor visits, prescriptions, lab tests and imaging tests, hospital stays, inpatient and outpatient procedures, and so on).
Meeting your plan's deductible or out-of-pocket limit (more on those below) will not waive the cost of a premium. Additionally, even if you never receive healthcare during the length of your policy, you're still responsible for the cost of your premium. No premium = no coverage.
Pretty much what it sounds like. In-network costs are associated with providers whom your health insurance company has decided to work with; out-of-network costs are associated with providers whom they have not. Certain policies will only cover in-network costs, while others will cover out-of-network costs at a much steeper price. (if that sounds annoying and pedantic, it's because it is.) Also, out-of-network costs generally do not count towards a deductible (which I’ll go over in a minute), and either don't count towards an out-of-pocket limit (ditto) or will go towards a separate, higher out-of-pocket limit.
You'll want to minimize out-of-network costs and stick with in-network doctors whenever you can. Certain popular plans are almost universally-accepted (from big companies like Aetna or United Healthcare), while other plans are accepted much more rarely. The size of your network is often tied to higher costs for premiums.
Certain healthcare costs don't require insurance approval—for example, seeing your primary care doctor or getting a flu shot are explicitly covered by most plans. This means your insurance company is either helping you pay for these costs in full or is counting your contribution towards these costs towards a running tally for your deductible and out-of-pocket limit (we'll get there soon, I promise).
However, certain costs require specific approval from your policy. This approval can either be obtained from a blanket list, where your provider will specify which procedures or prescriptions are approved and which ones are not, or require approval on a case-by-case basis. Your doctor may have to submit an approval request if you need an uncommon prescription drug or an expensive procedure or surgery. And other costs may be approved by default, but only for a set limit: your insurance many only cover two 30-day supplies of a single drug per year, or seven days of inpatient therapy. (I’m not actually sure what happens if you reach those limits and require more care—you may be able to file an appeal, but I personally have yet to do so.)
Your insurance policy can (and will) reject approval requests if they're not sufficiently convinced. They'll either force you to try something else first (usually something cheaper—for them) before approving the thing you need, provide you with an alternative (often inferior, almost always cheaper) course of care, or just outright reject it. You might have to jump through their stupid hoops or try submitting another approval request with stronger evidence in your favor. Insurance companies make you play this game because every time you get healthcare, it costs them money, and they don't want to pay any more than they absolutely have to... so they'll make you try something cheaper or make you get on your knees and beg. It sucks and it's one of the worst aspects of the American health insurance system, beyond the costs themselves.
Just because a cost is approved doesn't meant your insurance company is actually paying for all (or even part) of it—most of the time, you'll still have to pay for part of it. However, if a cost isn't approved, your insurance won't help you at all and any money you spend won't count towards your deductible or out-of-pocket limits.
Approved costs go hand-in-hand with in-network and out-of-network costs, but they're not quite the same; something can be in-network and not approved (even if you go to your insurance company's preferred laboratory, maybe your insurance hasn't necessarily approved the specific blood test), or out-of-network and approved (your policy automatically approves all policyholders for ten sessions of physical therapy, but not at this specific PT location).
This all gets hairy pretty fast. My advice is to read the fine print.
The amount of money you have to spend (out of your own wallet) before your insurance will cover certain services. Generally speaking, lower-deductible plans have higher premiums, and higher-deductible plans will have lower premiums—this is because plans with lower deductibles will cost you less in specific medical costs, which means the health insurance company charges you more for the better plan.
In other words, you want to meet your deductible. It's the amount the insurance company "deducts" from their own costs before they start helping you out on certain things. Meeting your deductible is a good thing, so a low-deductible plan is a good thing.
If you anticipate using your plan often, a lower deductible may save you money in the long run. However, if you don't anticipate using your plan much, then you may never meet any kind of deductible and therefore never reap the benefits of meeting it, so a (cheaper) high-deductible plan may suit you. There are other trade-offs associated with deductibles when it comes to specific benefits and coverage options, but the premiums tend to be the most obvious change between different deductible plans.