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Learning the Lingo of U.S. Healthcare Plans
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Steve Johnson

 

Accessing care through the U.S. healthcare system can seem like a daunting, mountainous task. After all, we fear the unknown. In fact, a recent survey shows that only 4 percent of Americans truly understand the key components of their health insurance and how they impact their out-of-pocket costs.

 

For international postdocs, that is undoubtedly even lower. You start with choosing a plan that suits your medical needs and budget, which would be difficult enough if the plan information were in plain English; unfortunately, it is not. Most people need a glossary to decipher the insurance jargon used to describe plan benefits, limitations, and exclusions. Then, once you choose a plan, you face the uncertainty of where and how to access care. Fortunately, when armed with a bit of knowledge and understanding, accessing care seems like less of a mountain and more of a molehill.

 

The ABCs of Healthcare

 

Let’s start with the nuts and bolts of health insurance coverage, those unfamiliar terms you may have come across when looking at benefit summaries or speaking with healthcare professionals.

 

Deductible: A specific dollar amount that your health insurance company may require that you pay out-of-pocket each year before your health insurance plan begins to make payments for claims. Not all health insurance plans require a deductible.

 

Out-of-Pocket Maximum (AKA Payment Limit): Out-of-pocket maximums apply to all medical plans. This is the maximum amount you will pay for healthcare costs in a calendar year. Once you have reached the out-of-pocket maximum, the plan will fully cover most eligible medical expenses for the rest of the plan year.

 

Coinsurance: The amount that you are required to pay for covered medical services after you've satisfied any copayment or deductible required by your health insurance plan. Coinsurance is typically a percentage of the charge for a service rendered by a healthcare provider. For example, if your insurance company covers 80 percent of the allowable charge for a specific service, you may be required to cover the remaining 20 percent as coinsurance.

 

Copayment: A flat charge that your health insurance plan may require you to pay for a specific medical service or supply, also referred to as a "copay." For example, your health insurance plan may require a $20 copayment for an office visit or brand-name prescription drug, after which the insurance company pays the remainder of the charges.

 

In-Network Provider: A healthcare professional, hospital, or pharmacy that has a contractual relationship with your health insurance company. This contractual relationship typically establishes set charges for specific services. An Out-of-Network provider is a healthcare professional, hospital, or pharmacy that is NOT part of your health plan's network of preferred (In-Network) providers. You will generally pay more for services received from out-of-network providers, in part because you may be responsible for out-of-pocket costs that are considered above the “reasonable and customary” fees for your geographic area.

 

Claim: A request by you or your healthcare provider for the insurance company to pay for medical services.

 

Health Maintenance Organization (HMO) Medical Plan: HMO plans offer a wide range of healthcare services through a network of providers that who agree to provide services to members at a pre-negotiated rate. As a member of an HMO, you are required to choose a primary care physician (PCP) who will provide most of your healthcare and refer you to HMO specialists as needed. Most HMO plans do not feature a deductible (though some do), and charge you flat amounts for services like hospitalization and outpatient surgery. Healthcare services obtained outside of the HMO plan’s network are typically not covered, though there may be exceptions in the case of an emergency.

 

Preferred Provider Organization (PPO) Medical Plan: A PPO plan allows you to access care through doctors that are in-network as well as out-of-network, but visiting in-network providers ensures that your claims paid at the highest level. You will not be required to coordinate your care through a primary care physician, as you would with an HMO, and you are able to “self-refer” to specialists. PPO plans are often costlier than HMO plans, but offer a greater level of freedom when accessing care.

 

But How Do I Use My Coverage?

 

Now that we’ve established what this insurance lingo means, let’s tackle the next hurdle: where and how to access care. The handy chart below can be used as a quick-reference guide if you find yourself wondering where to go for a certain illness, injury, etc.

 

Where Do I Access Care?

Type of Provider  Scenario Type of Illness or Injury 

Primary Care Physician (PCP)

(Common under HMO plan) 
Annual wellness exams, or moderate pain you need diagnosed General checkup, moderate pain of unknown origin, etc.

Specialist

(Requires referral from PCP under HMO) 
Experiencing pain specific to a particular region of the body (i.e. muscular, gastrointestinal, ocular, bone/joint, skin, ears/nose/throat, etc.) Ulcers, rash, digestive problems, vision problems, elevated levels, etc.
Hospital Having an inpatient or outpatient procedure performed, in a critical state Delivering a baby, major/minor surgery, recovery, monitoring, etc.
Walk-in Clinic Treatment of unscheduled, non-emergency illnesses/injuries and certain immunizations Vaccination, mild cold/flu, minor cuts/abrasions, etc.

Urgent Care

(Alternative to ER)
Treatment of most non-life-threatening emergencies Broken bones (not multiple fractures), minor wounds (not bleeding profusely), mild fever, flu, acute sinusitis, etc.
Emergency Room (ER) Treatment of all life/limb-threatening emergencies Severe head trauma, multiple/compound fractures, heavy bleeding, elevated fever, severe burns, seizures, poison, etc.

 

A Word of Caution

 

It’s important to remember that your plan’s network greatly affects the extent to which your care is covered or, if enrolled in an HMO plan, whether your care is covered at all. Most insurance companies offer online provider directories that require three pieces of information to perform a search: the type of provider (doctor or facility) you’re looking for, your zip code, and the name of your plan or network. The type of provider and location are simple enough, but plans and networks can be tricky. Insurance companies can offer dozens of plans, leading to an overwhelming drop-down menu full of plan names that look extremely similar. You don’t want to choose a plan that looks “close enough” during the search process, assuming the results will be applicable, only to find out the provider you visited was not in your plan’s network after all. Always be certain you are selecting the appropriate plan and/or network when utilizing an online provider directory, and call the provider ahead of time to make sure they are still in the network; provider directories are not always up-to-date.

 

International Coverage

 

Though you may have international travel plans, don’t count on your domestic insurance plan to offer you comprehensive coverage while abroad. Most domestic plans only offer international coverage for extreme emergencies (think imminent danger to your life and/or your limbs), if at all. Anything less severe and you’re on the hook for the total cost of the care. If you’re looking to travel and want or need more comprehensive coverage, you’ll want to purchase an international health plan from a reputable insurance company.

 

Get What You Pay For

 

You and/or your university may be paying each month toward your and your family’s health insurance, making routine medical care affordable and offering protection against catastrophic medical expenses. Learn how your medical plan operates so it works for you as intended, providing peace of mind and financial protection. That way, the next time you want or need to access care, you can have confidence in your coverage and focus on your health. Because at the end of the day, nothing is more important.

 

For over 28 years, Garnett-Powers & Associates, Inc. (GPA) have partnered with businesses, universities and individuals alike to assist in navigating the complicated world of insurance and compliance. With our professional and caring experts on your side, we’ll design and deliver comprehensive insurance and benefit solutions customized to your needs.

 

This article is contributed by GPA as part of its partnership with the NPA.

 

Steve Johnson, is vice president of University Services at Garnett-Powers & Associates.

 

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