What’s the Difference Between a Deductible and Out-of-Pocket?

For many people, the details that go into a health insurance plan seem to be made up of a foreign language. Between the confusing terminology and varying numbers or percentages, it is really difficult to understand what it all means. It makes it that much harder to choose the best insurance plan for you and your family. When you do some research and begin to have a solid grasp on the basics, then you can get more into the specifics. THINK Insurance & Financial Services in Pomona, CA will be able to assist you with a deeper dive into the particulars of each policy.

Deductible vs. Out-of-Pocket Limit

At first glance, these two concepts may sound like the same thing. However, that is not entirely true. The deductible is the dollar amount that you will have to pay out of your own pocket before your insurance begins to kick in. Once you reach your deductible, insurance will start to help with the medical costs. The amount that your insurance company will pay after your deductible is met depends on the coinsurance set in your plan. It is usually a percentage. For example, if your coinsurance is 30%, then you will only be responsible for 30% of the remaining costs (after you have hit your deductible).

Your out-of-pocket limit is the total amount you will have to pay out of your own pocket up to a certain amount. This would include the coinsurance and copayments, if applicable, in addition to the deductible. Be aware that your insurance premiums do not count as part of your out-of-pocket costs.

It is also important to consider that you will most likely have a higher premium if your plan specifies a lower deductible and out-of-pocket maximum. If you think you might need a decent amount of medical care that could end up costing quite a bit, these plans would probably be the best option.

Contact THINK Insurance & Financial Services in Pomona, CA

For more information on deductibles and out-of-pocket limits, contact THINK Insurance & Financial Services in Pomona, CA. They will be able to answer any and all questions regarding your health insurance plan options and help you choose the right policy for you and your family.