By Tonya Powell
Carrying a health insurance card doesn’t make you an expert on your benefits and trying to understand the process can seem very overwhelming. Here are a few key concepts that can help you better understand your health insurance:
1) Gain knowledge about your own benefits so you can be financially responsible. Take time to understand basic coverage terminology and how benefits apply to your healthcare options. Premium, deductible, coinsurance, coverage amounts, cost sharing, and maximum out-of-pocket cost are all important terms.
It is important for you to understand what your benefit plan will cover and how it will process and pay for services. The front of your insurance card will tell you what your copay and coinsurance amounts are, if applicable, and the back of the card will provide you with resources to help you access more information.
2) It is equally important to understand insurance language and processes. One common term that causes great confusion is “covered.” For insurance purposes, the term “covered” relates to a medical procedure that is considered medically necessary by your medical provider. Your insurance will pay for these services after you have met your cost obligation (e.g., copay, deductible, and coinsurance).
However, it is important to know that some services deemed covered will require your insurance provider’s authorization before receiving the healthcare service. Failing to obtain this authorization most often leads to your insurance denying payment. The facility where your procedure will take place must provide the insurance company information on the procedure type, date service will be provided, location, provider, and any supporting documentation to show why the service is necessary.
Depending on your plan, the insurance company can take up to 15 days or longer to make that determination and could require the insurance to speak directly with your doctor before a final determination is made. While the healthcare facility relies on this authorization to receive payment from the insurance company, it is ultimately the responsibility of the patient to make sure that this requirement is completed prior to receiving services.
3) After services are rendered, the billing office will send a claim form to your insurance company. This form will provide codes and information to represent services provided to you. Your insurance will use your individual plan benefits to process the claim, determine how much they will pay to the facility, and how much will be applied towards your copayment, deductible, or coinsurance amount. A summary of this information will be sent to you and the facility in the form of an Explanation of Benefits, or EOB. The billing office will make the appropriate adjustments to your account, and any remaining total be billed to the patient.
It’s important to remember that you have resources available to help you understand your coverage. Almost all insurance companies have a website with provider networks, coverage, and benefit details, claim status, and billing history. The more you understand your health plan and how it works, the more involved you can become in ensuring you get the best coverage at the best cost.
