How does health insurance work?

I just started a new job, which offers health insurance. The specifics of the plan are incomprehensible to me. What I do know is I went to a health clinic for STD testing, something I’ve done routinely for the last five years, once a year or when dating someone new, through my student health plan without significant cost. My plan apparently doesn’t cover this sort of thing, so I owe 76 for the visit. This is stunning. I need to understand my plan better so that I can make an educate decision if I should happen to find myself legitimately ill in the near future. The company’s website offers nothing in the way of specific explanation, just the usual gibberish.


  • beamer

    How does health insurance work? Imagine you have a $100,000 heart surgery, which is a covered medical expense under your health insurance plan, and let’s say this health insurance plan has a $1,000 annual deductible, 20% coinsurance after deductible, $2,000 out-of-pocket limit per year and $5 Million lifetime maximum. *

    Typically, a deductible is the amount of money you must pay each year before your health insurance plan starts to pay for covered medical expenses.
    So with a $100,000 heart surgery bill, you are responsible for paying the first $1,000. After this $1,000 deductible is met, the insurance company will pay a percentage of the bill in what is called the coinsurance.

    Typically, coinsurance is a cost-sharing requirement where you are responsible for paying a certain percentage and the insurance company will pay the remaining percentage of the covered medical expenses after your deductible is met.
    For a health insurance plan with 20% coinsurance, once the deductible is met, the insurance company will pay 80% of the covered expenses while you pay the remaining 20% until your out-of-pocket limit is reached for the year.

    Typically, the out-of-pocket limit is the maximum amount you will pay out of your own pocket for covered medical expenses in a given year.
    For a plan with a $2,000 out-of-pocket limit, you will pay a $1,000 deductible and $1,000 coinsurance while the insurance company covers the remaining $98,000 of the heart surgery bill. Even if you are hospitalized again in the same year, the insurance company will pay 100% of your covered expenses within the limit of the lifetime maximum.

    Typically, a lifetime maximum is the amount your insurance plan will pay for covered medical expenses in the course of your lifetime.
    Since the health insurance plan has a lifetime maximum of $5 million, and as you pay your deductible, coinsurance and out-of-pocket limit each year, the insurance company will pay for all remaining covered medical bills up to a maximum of $5,000,000 in your lifetime.

    Typically, a co-payment or co-pay is a specific flat fee you pay for each medical service, such as $30 for an office visit, after which the insurance company often pays the remainder of the covered medical charges. Let’s say you are not feeling well and went to see your doctor who charges $200 for the office visit. If your insurance plan has an office visit co-payment of $30, then you will only be responsible for the $30 and the insurance company will cover the remaining $170.

  • ask for the plan booklet. It will explain everything in English and there is normally a number you can call if you have questions!!

  • bocoo_man

    Health insurance is in business to make money just as any other business. Even The big blue. Which is a non-profit insurance. Basically the people that don’t get sick very often or not seriously are the ones that pay for the sickly. Most insurance’s do not pay for elective surgery or frivolous illness. In your case that you just described you are being irresponsible in the insurance co.point of view. You are promiscuous in your actions. So they are not going to pay until you get a STD. Prevention is up to you. Not the insurance co.

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