Demystifying Health Insurance Terms: A Guide for Patients

"Co-pay," "deductible," "max out of pocket costs," "in-network," "out of network," "premiums." With benefits open enrollment season upon us, have you ever looked through some of these plans and terms above and found yourself scratching your head? Or maybe just yelling "WTF" to the universe? Do you find yourself overwhelmed or frustrated with the increasing costs of healthcare? Not only the insurance premiums, but the lack of what is covered when you DO need to see a provider?

What I have found over the years, and still see to this day, is the substantial amount of people confused on what each of these terms mean and what their individual plan covers or doesn't cover. Not only that, we as clinicians receive a lot of the frustrations when things are not covered, or the cost is substantially high.

Let me tell you, WE AS PROVIDERS are JUST AS FRUSTRATED as you all are. They don't teach you in medical school or PA school all the red tape and regulations that go into healthcare. They don't teach you what "codes" to use to get items covered, and they certainly do not teach you even while being a clinician the COST of each office visit, medication, and so on.

Did you know that in a traditional model, we code each diagnosis based on what is called ICD-10 codes, and there are over 70,000 codes to pick from? We also have to submit each visit for coding, and pick from CPT codes, which also have over 11,000 codes to pick from. In addition, there are approximately 900 health insurance companies in the US, all of which might have an additional 3 to 5 "plans" to pick from, all of which have different levels of deductibles, different levels of coverage and different regulations, as well as different "formularies" for prescription costs.

Understanding Key Health Insurance Terms

1. What is an insurance premium?

This is the actual cost of your insurance plan that you, or an employer, may contribute to and pay every month. These can be paid monthly, quarterly or yearly, and the premium does NOT contribute to the deductible or out-of-pocket costs. If there is a missed payment, this can lead to a lapse in coverage.

2. What is a deductible?

This is the amount of money you are required to pay for healthcare services OUT-OF-POCKET BEFORE your insurance starts to kick in and cover a portion of the costs. For example, if your deductible is $2,000, your plan won't pay for care until you spend this amount on covered services.

3. What is "max out of pocket"?

This is the maximum amount you will ever pay for covered services in a policy year. Once you reach THIS limit, then your health insurance will cover 100% of expenses. This may sound beneficial, however most individuals will never meet this max out-of-pocket cost. For example, if we take the same scenario listed above with a deductible of $2,000, you may have a further max out-of-pocket cost of $8,000.

4. What is a co-pay?

A co-pay is a fixed amount of money that you pay for a specific service or medication at the time you receive it. For example, you may pay $25 when visiting a doctor but have a different co-pay for prescriptions or specialist visits.

5. What about preventative care?

This is any service considered by your insurance company as services intended to keep you healthy, help prevent diseases or prevent chronic health conditions. This may be annual check-ups, counseling advice, screening labs and vaccinations. However, while there are certain preventative care items we KNOW are covered (cervical cancer screening, mammograms, colonoscopy, etc.), we do NOT know exactly what items are considered "preventative" in lab work screenings.

6. In-network vs. Out of network

In-network providers have agreements DIRECTLY with your insurance company to provide services at "contracted" or reduced rates, which means you in turn pay less when you see them. Out-of-network providers do not have these agreements, resulting in higher costs, or in some cases, no coverage at all. The average max out-of-pocket for an out-of-network provider is close to $15,000.

The Confusion and the Stress

For many individuals, deciphering these terms adds an unnecessary layer of stress to healthcare. Misunderstanding insurance language can lead to unexpected costs, delayed care, or even avoiding necessary medical attention due to financial worries and the unknown.

The Solution: Direct Primary Care

As open enrollment approaches, considering transformative and alternative ways to the traditional insurance-based model is vital. One such alternative is Direct Primary Care, often referred to as DPC.

DPC provides patients with a straightforward monthly subscription model for primary care where high-quality care, unlimited visits, direct access to your healthcare team, individualized care and access to HIGHLY reduced cash-based lab fees all fall under your monthly membership. Not only that, but the costs of procedures are HIGHLY reduced as well.

While DPC is certainly NOT a replacement for health insurance, the reality is that most Americans have shifted to a high deductible insurance plan. Shifting the cost to a high deductible plan or catastrophic plan, and pairing it with a DPC membership, can actually save you HUNDREDS of dollars.

Benefits of Direct Primary Care

SIMPLICITY. DPC eliminates the RED TAPE holding you back from having a DIRECT relationship with your provider. For the flat-rate monthly fee, patients have access to their primary care doctor, without the hassle of insurance claims, or co-pays. There is no additional co-pay you pay when you want to be seen. You DO get to talk DIRECTLY to us, not a phone bank or waiting hours to hear back.

PERSONALIZED MEDICINE. The average time you get to spend with your primary care provider in a traditional insurance-based model is down to 11 minutes. In DPC, we have limited our patient panel size to 400 to 500 patients, ensuring you get all the time you need for your health.

ACCESSIBLE CARE. We believe that QUALITY healthcare should be accessible to everyone and really do prioritize VALUE over VOLUME. The average wait time to get in with your primary care provider in a traditional setting is 29 days. In DPC, when we take on less patients, we are ABLE to offer next-day, sometimes even same-day appointments.

TRANSPARENCY. Not only is our pricing in DPC very straightforward, patients know what they are paying and what services are covered under that cost. It removes the stress of unexpected bills that arrive in your mailbox months later.

AFFORDABILITY. With our affordable monthly fee, most individuals find they can actually save money long-term by combining a DPC membership with a higher deductible insurance policy or cost sharing plan.

Stop Waiting

Review your health plan, talk with your benefits director and take charge of your health by exploring this TRANSFORMATIVE way of care. Join Resurgent Health today or schedule a free Meet and Greet with us to hear how passionate we are and how we can truly improve your healthcare journey today.

Resurgent Health acknowledges that we are NOT a replacement for health insurance and we do still recommend that you sign up for some form of insurance after discussing with your benefits director.

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