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| How
Health Insurance Plan Copays Work! |
| Choose
from the terms below to get detailed information on how each of
these benefit options work. |
EGS would rather it's clients be informed
buyers than to simply sell insurance and added benefits that the client
may not need. Therefore we are presenting this information as a
helpful guide for you to make an informed decision on which plan to buy
and which benefits to include. We are not attempting to persuade you to
either include or exclude certain benefits from your health insurance
plans. We simply want you to make the right decision for you and be
happy with your selection. This guide is presented in general terms
and attempts to explain how health insurance plans work. Not all
plans work equally nor does this imply that this information is valid in
all states or situations. It does however, give the general workings
of many health insurance plans and how deductibles, coinsurance, and
copays function.
Copay
The copay that comes with many of
today's health insurance plans is often referred to as the Doctor Office
Copay. In most cases, the copay is an added benefit where the
insured person only has to pay the low ($15, $20, $30, etc..) for doctor
office visits. The Deductible of the health plan does not usually
have to be met for these charges. The insured can just pay the copay
for doctor office visits and not have to satisfy the deductible of the
plan. This copay however, just applies to the doctor office visit
charges and usually does not apply to any charges the physician would bill
for outside facility charges such as radiology, blood tests, etc...
For example: If the insured goes to
the doctor for let's say a case of the flu. The doctor might run
blood tests or even do an x-ray of the patients lungs. The bill
would therefore consist mainly of a doctor office charge, a lab test
reading, and a radiology charge. The copay would usually only apply
for the doctor office charge. The radiology and the lab screening
would go towards satisfying the deductible and coinsurance levels of the
policy. We will handle the Coinsurance term later in this
discussion. Let's say the doctor office charge was $90, and
the remaining charges add up to $250, and the insured had chosen a $20
copay for their plan. The $90 would be taken care of with a $20 fee
paid by the insured. There should be no balance left and the
remaining $70 of the doctor office charge would be $0. The $250
remaining charges would be the responsibility of the insured, assuming
that the deductible of the plan had not yet been met for the year.
Essentially the insured only saved a total of $70 on the visit.
Sounds like quite a savings right? Well maybe not! The
insurance premium that is paid by the insured every month includes a
charge for having this Copay benefit on the policy. For example:
The monthly premium for the insured is let's say $280. Let's also
assume that $40 of that monthly premium is for the doctor office Copay
benefit. That insured is paying $480 per year for a benefit that
only saves them, in this scenario, $70 per visit. For this benefit
to be cost effective, the insured would have to visit the doctor nearly 7
times per year for the benefit to be worth what they are paying for it.
Now keep in mind that these insurance levels are per person.
Therefore, a large family might well benefit by the added insurance of a
Copay, especially if there are several children on the plan. Like
was mentioned at the top of this article, not all plans work the same and
these numbers are just examples. The person purchasing insurance
should breakdown these numbers and evaluate whether the benefits is worth
the cost. A Copay benefit can be a significant portion of the
premium that the insured pays each month. Remember that the lower
the copay the higher the cost. Most plans give the insured the
ability to remove the copay benefit altogether, resulting in an even lower
premium.
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