Out-of-Pocket Limit

The maximum amount an individual or family is required to pay for covered healthcare expenses during a specific period, beyond which the insurance plan covers 100% of the costs.

 

Deductible:

The initial amount an individual must pay for covered healthcare services before the insurance plan begins to contribute. This is separate from the out-of-pocket limit.

 

Co-payment:

A fixed amount that a patient pays for covered healthcare services at the time of service, often required for both in-network and out-of-network care.

 

Co-insurance:

A cost-sharing arrangement in health insurance where the policyholder pays a percentage of the covered healthcare expenses after meeting the deductible, until reaching the out-of-pocket limit.

 

Provider Network:

A list of healthcare providers, including doctors, hospitals, and clinics, that have contractual agreements with a specific insurance plan to provide services at negotiated rates.

 

In-network:

Healthcare providers or facilities that have a contractual agreement with an individual’s insurance plan, typically resulting in lower out-of-pocket costs for the insured.

 

Out-of-network:

Healthcare providers or facilities that do not have a contractual agreement with an individual’s insurance plan. Seeking services from these providers may result in higher out-of-pocket costs.

 

Explanation of Benefits (EOB):

A statement from the insurance company explaining how a claim was processed, including details on what the insurance covered, what the patient owes, and any remaining balance.

 

Annual Renewal:

The yearly process during which individuals review and update their health insurance coverage, including any changes to premiums, deductibles, and out-of-pocket limits.

 

Health Savings Account (HSA):

A tax-advantaged savings account that allows individuals to set aside funds for qualified medical expenses, often used in conjunction with high-deductible health plans.

 

Flexible Spending Account (FSA):

A tax-advantaged savings account that allows individuals to set aside pre-tax dollars for qualified medical expenses, often used in conjunction with traditional health insurance plans.