Do You Know What These Health Insurance Terms Mean?

Greg Daugherty | Oct 6th 2017 Oct 6th 2017

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The percentage of your medical costs that you, and not the insurance company, are responsible for paying is called your:
  1. 1 Coinsurance
  2. 0 Copayment
  3. 0 Collectible
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The correct answer is 1. If your insurer pays 80 percent, for example, your coinsurance is 20 percent. You may also have to make a copayment when you visit your doctor or other health provider. Copayments aren’t a percentage, but a fixed dollar amount, such as $25.

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  1. The percentage of your medical costs that you, and not the insurance company, are responsible for paying is called your:

    Correct Answer: Coinsurance

    The correct answer is 1. If your insurer pays 80 percent, for example, your coinsurance is 20 percent. You may also have to make a copayment when you visit your doctor or other health provider. Copayments aren’t a percentage, but a fixed dollar amount, such as $25.

  2. Your insurance plan may not pay anything at all until you’ve spent a certain amount and paid for it yourself. That’s known as your:

    Correct Answer: Deductible

    The correct answer is 2. If your annual deductible is $1,000, for example, your insurer usually won’t start paying claims until you’ve spent $1,000 of your own money.

  3. The price that you (and your employer, if you receive coverage through work) pay for your insurance is called your:

    Correct Answer: Premium

    The correct answer is 1.

  4. A preferred provider is:

    Correct Answer: A doctor or other provider who has contracted with your insurer to offer discounted services.

    The correct answer is 2. Your plan may also have “participating” providers (see next question).

  5. Compared with a preferred provider, a participating provider is likely to charge you:

    Correct Answer: More

    The correct answer is 1.

  6. If a provider sends you a bill for more money after your insurance company has paid its share, that’s called:

    Correct Answer: Balance billing

    The correct answer is 1. Note that a preferred provider isn’t supposed to balance bill you for covered services.

  7. The allowed amount in your policy is:

    Correct Answer: The maximum charge for a particular service that your insurer will use in calculating its payment.

    The correct answer is 2. For example, if the allowed amount for a particular service is $100 and your insurer pays 80 percent of allowed charges, it would pay the provider $80, and you’d be responsible for $20. The U.S. Department of Health and Human Services notes that this provision may also be called “eligible expense,” “negotiated rate,” or “payment allowance.”

  8. Your out-of-pocket limit is:

    Correct Answer: The most you’ll have to pay for services before your insurer pays 100 percent of your allowed claims.

    The correct answer is 2. Your out-of-pocket limit is for a specific time period, typically a year. Once you’ve reached your limit, you no longer have to pay coinsurance.

  9. If you have health coverage through work but lose your job, you may be eligible to stay on your employer’s plan for a period of time through a program called:

    Correct Answer: COBRA

    The correct answer is 2. COBRA gets its unusual name from a federal law called the Consolidated Omnibus Budget Reconciliation Act.

  10. If you disagree with a decision your insurance company has made, you can request what’s known as:

    Correct Answer: Both

    The correct answer is 3. In an internal appeal, you ask the insurance company to reconsider. In an external review, you take your case to an independent third party. Here’s more information about how to challenge an insurer’s decision.