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Deductibles, co-insurance, premiums... do you understand how they all work? Listen in and learn with Joseph as he discusses costs with a customer advocate.
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Originally published 11/24/2020; Video revised 6/2023
JOSEPH: Hi! My name is Joseph and today I'm meeting with a Blue Cross and Blue Shield customer advocate to talk about... understanding health plans and costs. I'm trying to budget for my family's health care but I'm not sure how to figure out what costs I'm responsible for. Deductibles, coinsurance, premiums, I have to admit I don't really get how they work. Can you help me?
BCBS ADVOCATE: The first cost to understand is your premium. It's an ongoing cost you pay to have health coverage. It's usually done once a month but you could have a different payment timeframe.
JOSEPH: Okay. When I go to the doctor it seems like I'm not always getting charged the same amount. What's that about?
BCBS ADVOCATE: Well there could be a few reasons for that. Many plans cover preventive care with no added cost to you, so if you went in for a wellness checkup you may not know anything for that visit. A copay is a flat fee that you pay upfront. The copay depends on your plan, the type of provider you see, and whether they're in your plans network. For the sake of this conversation let's say that under your plan it's a $30 copay for doctor's visit.
JOSEPH: Okay, that makes sense but when I had blood work done I got a bill for the whole service. Why is that?
BCBS ADVOCATE: A lot of plans have a deductible that applies to certain services. For example if your plan has a $1,000 deductible for lab work and x-rays you would pay 100% of the cost up to $1,000 before your plan begins to pay for those services.
JOSEPH: So what happens after I paid the $1,000?
BCBS ADVOCATE: Then you are responsible for coinsurance. The coinsurance is the amount you pay after your deductible is spent. It's usually a percentage. As an example let's say you've already met your deductible then later in the year you have an x-ray that has a payment of $400. If your coinsurance is 10% you'd owe $40 for the x-ray. Co-pays are paid whether your deductible is met, unless your service is not subject to cost sharing.
JOSEPH: Okay, so my premium is what I pay each month. My copay is a flat amount I pay for the office visit and my coinsurance is a percentage I pay for other services after the deductible.
BCBS ADVOCATE: You've got it! Be sure to look at your plan details for your deductible and how copay and coinsurance work.
JOSEPH: I'll definitely do that.
BCBS ADVOCATE: There's also a limit on how much you might have to pay each year. It's called an out-of-pocket maximum. After you reach this amount your plan will pay for most of the other covered expenses for the rest of the year.
JOSEPH: I like the sound of that. How much is my out-of-pocket max?
BCBS ADVOCATE: You can find out when you register and log into Blue Access for Members, under the my coverage tab. If you still have questions call the number on your member ID card.
JOSEPH: This has been so helpful. Thank you for meeting me.
BCBS ADVOCATE: My pleasure.
SPEAKER: For more information call the number on your member ID card or visit our website at BCBSNM.com.
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