DEDUCTIBLE

A health insurance deductible is the first amount or bit of your health insurance bills that you end up paying. So if you have a $500 deductible, you are generally going to pay the first $500. If you have a thousand dollars deductible, you are going to pay the first $1000 in a health insurance deductible. It's the way that this works. Now, there are some things that you might pay before heading the deductible. Sometimes if you have an office visit, you would pay a copay of $25, $50, or $100 to go see a doctor. Some companies will put the copays to go towards the deductible, and for most companies, the copay goes towards the out-of-pocket maximum that you're going to have for the year. Prescriptions can also come into play there as well. For some prescription plans, you'll get to pay a co-pay or it's a small amount for a drug. In the event of generic drugs, you may pay $5, $10, or $25, for name brands you may pay $10, $25, $50, or $75, and for special drugs, you might pay $25, $50, $100, or $125. They have different tiers for those drugs. And sometimes, you have an emergency room copay before it hits your deductible. So you pay the copay, then it goes towards the deductible. But in general, if you have the deductible. That's generally the first amount of money you pay before the insurance company starts paying part of the bill. Now, that being said, with almost every insurance company, you're gonna get their negotiated discounts with the provider. That even with that first amount of dollars, first $500, $1000, $1500, $2000, $2500, $5000, whatever the deductible amount is. So, if you go to the doctor and you get a bill for $5000 dollars, it might be negotiated down to $2800, so you're not paying the full amount of the $5000 if you're deductible is to be $5000. You'll be going to pay $2800 because you still get the benefit of the negotiated rates that your health insurance company has negotiated with the providers. That's why it actually does make a pretty big difference in your healthcare cost, depending on which insurance company you go with. Because the better the negotiated rates, the lesser you're going to pay to the physician or provider at the time of a claim.You can also have a deductible for a network and a separate deductible for going out of network in a BPO plan. That's a preferred provider organization plan. You can go to the doctors that are working inside the network, that has contracted with the health provider or you can go outside. And the ones that are outside will accept the coverage but they might not give you any discounts. Most insurance companies offer a preferred provider organization, where you can go in that working network and will have a separate deductible for out-of-network. Some will combine those together, so you can have one total deductible for in and out networks. For most of them, you'll have a separate deductible, one deductible for
in-network and one for out-of-network expenses. So, you do need to keep that in mind, when you go to the doctor, your money is always going to go further when you go to an in-network provider.

EMBEDDED DEDUCTIBLE

The first deductible is what is called an embedded deductible, meaning that there are two deductible amounts within one plan; single and family. The single deductible is embedded in the family deductible, so no one family member can contribute more than a single amount toward the family deductible.

Family health insurance plans can have one of two types of deductibles: Embedded deductible (includes an individual and family deductible) and Non-embedded deductible (includes only a family deductible).

SHARED DEDUCTIBLE

This is called "cost sharing." You pay some of your health care costs and your health insurance company pays some of your health care costs. If you get a service or procedure that's covered by a health or a dental plan, you "share" the cost by paying a copayment, or a deductible and coinsurance.

MAXIMUM DEDUCTIBLE

Most companies are either two deductibles per family max or three deductibles per family max, meaning if you have one person that could hit the deductible and say the deductible is $2000. One person hitting the deductible of $2000, means that they've hit their deductible. You could have two people each hit $2000 and if you have a two-times deductible max, then that way no one else in the would have to hit that deductible. For example, you're in a car and the bill is $5000, and there are four people in the car. If you have two deductibles per family, then the first two people that hit their deductible would be done at $4000. And no one else would have any deductible at all the hit. If it's three, the first three would do it and then no one else would have to do it. But it could be any format of it, you can have a family of 8, and it's a $2000 per person deductible maximum of 4 for the family. If the entire family hits $500 then the $4000 family deductible is set. Then, everybody after that is going towards paying the out-of-pocket amount. And the insurance company is gonna pay their share of the coinsurance and the employee is gonna pay their share of the co-insurance.