Important Health Insurance Definitions

Copay – a fee you pay at the time of service or after for a particular service. Usually you do not need to pay any more for that particular service. A copay is an amount you usually at the time of service, and your deductible does not apply, or have to be satisfied for the service to be covered (paid) by the insurance.

Co-insurance – the percentage you, the member pays after the insurance pays their percentage. For example, insurance pays 80%, member co-insurance is 20%. Often times this is after you have satisfied your deductible. 

Deductible – an amount you must reach before the insurance pays for you expenses. Some Bronze Plans will not cover your expense until you have incurred expenses that exceed your annual deductible amount. The deductible is the amount you pay before the insurance pays their percentage (80%, 70% or 50%). Deductible applies to larger expenses such as surgery, hospitalization, complex imaging, and ambulance. These are the services that ARE NOT listed as covered after a copay.

Maximum out of pocket – All medical and prescription copays, the deductible amount and co-insurance amounts you pay accumulate toward the annual maximum out of pocket amount. When you reach that amount of out of pocket costs, your insurance plan pays 100%.

Advanced premium tax credit – a federal government subsidy based on your future tax refund paid to your health insurance company towards the monthly premium.

Subsidized Coverage – health coverage that is obtained through the use of financial assistance from federal/state government. Only obtained through Healthcare.gov and for low/middle income households.

Special Enrollment Period – 60 day period throughout the year that comes into effect during a major life change (moving, family member additions, employment change, etc.), and is the only time outside of Open Enrollment that a person qualifies to change plans.

Network, In- and Out-  - The facilities, providers and suppliers your health insurance carrier/plan is contracted with and will cover costs on an agreed rate (seen on plans). To receive highest coverage amounts, find providers that are in your plan’s network.

Formulary – a list of prescription drugs that are covered within any given insurance plan. Also known as a drug list, can help people find what prescriptions are covered in their plan.