Can you explain what difference is between deductibles and out of pocket costs?

[Serial Mom]

We might be deciding on choice of plans (currently on COBRA) and have always been upset that nobody representing the insurance companies can tell us what (and WHO) determines an "out of pocket" expense/cost and why (and WHO) says it differs from "deductible" costs.

Anybody? ... anybody.... anybody?

[LiberalAndProud]

1. My agent told me that out of pocket = copay + deductible.

Copays do not accumulate toward your deductible, so out of pocket is the higher figure. I might disremember this, as I haven't spoken to my agent since we dropped health insurance a couple of years ago.

[M0rpheus]

3. depends on what you mean by out of pocket costs...

Are you talking about the out of pocket maximum or just what you have to pay?

[Carl Skan]

2. It depends on the plan.

There's no such thing as an absolute answer.

[Serial Mom]

7. But when the rep is right there, explaining to employees (or to us on phone)..

they can't define it. We have received nothing but a run-around with the answers.

So I guess your answer is kind how they answer, and we'll never know what they truly mean until we have a portion of a bill applied to deductible, they pay their crappy little portion and the rest we have to pay towards out of pocket.

[ThomWV]

4. Sure - out of pocket is when they screw you at the office , the Deducatable screwin' comes later

When you get the notice from the insurance company telling you how much they didn't pay.

[Serial Mom]

9. Heehee... how true!

[ejpoeta]

5. i never understood that myself.

[vi5]

6. Here's a simple a description as I can muster...

Deductible: The amount you have to pay before the insurance company even ponies up one single penny. Example: If your annual deductible is $250, and you go to the doctor only once a year for a check up, and that costs $250 then you pay all your medical bills for the year. The insurance company pays nothing.

Copay: The amount, after a deductible has been met, that is your portion of whatever is billed by the doctor (but also negotiated by the insurance company. Example. You get your tonsils removed. The surgeon bills your insurance company $10,000. The insurance companies pre-negotiated rate for that procedure is $1,000. Therefore your copay is whatever percentage your plan dictates. If you have an 80/20 plan then the insurance company pays $800 and you pay $200.

Out of Pocket: This is the total you spend each year for the combination of deductibles, copays, etc. For example. If you have a bunch of doctor visits and or procedures performed, you pay your assigned copay for each until you hit whatever your "out of pocket maximum" is for the year (if you have one).

Lifetime cap: The total amount that an insurance company will pay out for your medical bills, even if you remain covered under them.

Hope this helps. These are pretty straight forward numbers that should be able to be gotten if you just ask. They should be very straightforward numbers.

[Carl Skan]

10. Re:Copay

I think you might be just a bit off on that one. We're on Humana and the deductible isn't taken into consideration for copays and doctor's visits.

[vi5]

12. Maybe depends on the plan, I suppose...

I've had over the years both Aetna and Blue Cross Blue Shield. My son has had both of those, plus Cigna through my wife as well. On all of those my copays were applied to my deductible.

[Serial Mom]

This was best I've heard, BUT

I have never seen the total the out of pocket costs on the EOBs to reach our maximum!

Do I have to keep track of it??

(reply to vi5 #6 post - btw, thanks for explanation)

[vi5]

13. If your eob's don't have it....

..it should be a number easily provided by a customer service rep.

My EOB's always had it on there but it was wildly inaccurate most of the time due to overlapping bills, renegotiations, payments, etc.

Should be pretty easy to just call up and get it (well...as easy as calling any customer service line is I suppose).

I wish I didn't know all of this but my son was born 3 years ago with multiple issues and has racked up about $750,000 paid out by multiple insurance companies.

[SoCalDem]

8. Deductible is usually the amount you must spend BEFORE any coverage kicks in

This is the way "old-timey" insurance worked. In 1975 we had one like this. We had to mail them EVERY receipt for EVERYTHING we bought that was medical..doctors office receipts, prescription receipts..

Once a month I filled out a worksheet and sent it off with the actual receipts (we kept copies). We had a $1K per person deductible. When one of us hit the $1K mark, they sent us a check every month for 80% of the receipts we sent in. We had a son with a birth defect (and LOTS of surgeries), so we always met his deductible in January, but my husband and I never hit the $1K (after the birth of our son), so every year we got NOTHING back for our medical care, but 80-% of everything over the $1K for Scott.

there were no "co-pays".. you paid it ALL..up front

The premiums were deducted from my husband's paycheck.

[question everything]

11. Deductible often have a ceiling

For example, you may have a max. deductible of $1,000 in one calendar year. It may be per patient or it may be per family.

You are responsible to pay that $1,000. Once you've reached this, you have to pay only the co-payment which usually is a percentage of the allowed charge.

The deductible and co-pay are part of the "out of pocket" and often have a ceiling, too.

======

There are several DUers who have been in this business, so I hope you'll get a more authoritative reply..

[HopeHoops]

14. Deductible is a fixed amount before they consider paying for the claim.

After the deductible is met, THEN the out of pocket costs kick in - that's when you have to pay everything else because they deny the insurance company denies the claim.