Understanding how the different aspects of your health insurance work is necessary to choose the right Ohio health insurance plan. The ideal plan is one that would pay for the medical expenses that you cannot afford on your own. Sickness and injury cannot be predicted, so when you purchase a health insurance plan, look for one that covers all types of medical care – from outpatient treatment, doctor visits and hospitalization to emergency services, prescription drugs, lab tests, and preventive care. You should make sure that the plan you enroll in covers 100 percent of your medical expenses after you meet your out-of-pocket expenses.
The Different Components of an Ohio Health Insurance Plan
To know how your health insurance works, you have to understand the meaning of its different components such as deductible, coinsurance, co-pay, out-of-pocket limit, and annual coverage limit.
Suppose you have had an accident and need orthopedic surgery costing $80,000. Suppose your plan has a $2000 deductible, 20% coinsurance after deductible, a $4000 out-of-pocket limit, and a $1,000,000 annual limit on your health insurance coverage.
• Deductible: This is the amount you have to pay each year before your Ohio health plan starts to pay for covered medical expenses. For orthopedic surgery costing $80,000, you are responsible for paying the first $2000 deductible. After this deductible is met, your health insurance plan will pay a certain percentage of the bill and you will pay the coinsurance.
• Coinsurance: This is a cost-sharing requirement involving you and the insurance company. For an Ohio health insurance plan with 20% coinsurance, once the deductible is met, your insurance company will pay for the remaining 80% of your medical expenses till your out-of-pocket limit is reached for the year.
• Out-of-pocket limit: This is the maximum amount that you will pay out-of-pocket for your covered medical expenses during a year. For a plan with a $4000 out-pocket-limit, you will pay a $2000 deductible and a $2000 coinsurance, and your insurance company will pay the remaining $76,000 of your orthopedic surgery expenses. Even if you are hospitalized again during the same year, your Ohio individual health insurance policy will cover 100% of your expenses till your annual coverage limit is reached.
• Annual coverage limit: Some types of Ohio health insurance plans fix a dollar limit on the amount that they will pay over the course of the plan period of one year. If you enrolled in your health insurance plan in December 2011, your plan period would be from December 2011 to November 2012. If your plan has an annual limit of $1,000,000 and your medical expenses for that year are more than $1,000,000 you would have to pay for these expenses out of your own pocket.
If you renew your health insurance policy in November 2012, your deductible, coinsurance, out-of-pocket limit and annual coverage limit would all be renewed, and your health insurance would once again begin paying according to the plan.
Co-pay: This is the flat fee you pay when you receive a medical service. For instance, if a visit to the doctor’s office costs you $200 and your copay is $20, the insurance company pays the remaining $180.
Important Changes since the Affordable Care Act was Passed
The Affordable Care Act of 2010 has brought about some important changes. Two important points:
• If your plan was purchased after September 23, 2010, it will have no lifetime maximum limits on most benefits.
• Ohio health plans bought after January 1, 2014, will have no annual limit on most covered services.
Additionally healthcare law provides you with:
• Protection from rate increases: Ohio health insurance companies cannot raise premiums without an adequate explanation
• Added protection from having your health insurance cancelled
• Coverage for preventive care without cost sharing
• No lifetime maximum oh health coverage
• No pre-existing condition exclusion for children
If you are planning to enroll in an Ohio health insurance plan, get professional guidance from a licensed experienced health insurance broker to understand these concepts and purchase an affordable plan with the maximum benefits.