Whether or not copays count towards a deductible is actually a pretty common question. A lot of people don’t understand their health insurance, which is why the healthcare system is so difficult to manage in the United States. But understanding what your premiums are, what your deductible is and how your co-pays work are all important factors in managing your health insurance effectively. Let’s take a look at each of these in turn and break them down so that they are a lot easier to understand. There are plenty of options with most health insurance plans, and understanding these terms is the first step to creating the perfect plan for you.
What is a Deductible?
The first thing you need to know is what a deductible is and how to choose the one for your plan. A deductible is the amount of money that you agree to pay for your medical bills before the insurance has to pay anything. Your plan premium, which is the amount of money that you pay monthly for your health insurance coverage, is at the opposite end of the scale from the deductible.
In other words, when you choose a high deductible, your premium almost always goes down. On the other hand, when you choose a low deductible, then you’re going to have to pay more per month. So, for example, if you have a deductible of $5000, then you are going to have to pay that amount toward your medical bills within a year before your insurance company will pay anything. If you do not have any major medical bills, then you may only have to pay a few hundred dollars. If you have a major accident and have tens of thousands of dollars in medical bills, then after $5000 the insurance company will pay the rest on covered services.
What is a Co-Pay?
The next thing that you need to understand is a co-pay. Your co-pay is amount of money that you pay for a doctor’s visit when your insurance company is picking up the bill. What this means of course is that your co-pay does not go toward your deductible because your deductible will need to have already been paid before your insurance company starts paying for your medical care. Even after you meet your deductible, your insurance company may require a co-pay to go and have certain procedures done or even just to have a regular checkup.
In addition, some insurance plans have specific treatments that they will cover without needing to meet the deductible; a common example is your yearly physical. You may have to pay a co-pay on this, but even then, it will not be going toward your deductible. You also may have a co-pay the you will be responsible for on all of your prescriptions. Many insurance companies require that you pay a nominal amount to pick up prescriptions even if they cover them. Often, you do not have to meet a deductible in order to have them cover your prescriptions.
Other Things You Need to Know
There are a few other things that you need to know about your insurance plan as well. First of all, not every procedure is going to be covered. Depending upon your plan, standard procedures like yearly physicals, x-rays, emergency hospital visits and most prescriptions may be covered. However, you want to check your plan carefully whatever you are going to have a procedure, because you may assume that the insurance covers it when it doesn’t and you are going to be responsible for paying that bill out of your own pocket.
You also need to know that you have plan premiums that you have to pay every month. The amount of this premium varies depending upon what sort of health insurance plan you have chosen, your deductible, whether you have any extras like dental and lots of other factors. The best way to approach choosing health insurance is to determine what you can afford as far as a monthly payment and then choose all the other options like your deductible around that monthly payment.
The Bottom Line
The bottom line is that there is a lot about health insurance that you have to know and take into consideration when you are choosing your health insurance plan. If you can educate yourself on how health insurance works, what sort of a deductible you can afford and what happens in various situations where you either don’t need your health care plan or you need it for major procedures, then you will be much better equipped to choose the right plan for you and make sure that you can make it through the next healthcare emergency without a major financial crisis.