Car Accidents Sports Injuries Sciatica Rotator Cuff Carpal Tunnel Headaches Muscle Testing Nutrition Scoliosis TMJ Fibromyalgia
Health News and Tips
Here's some help in understanding the terms.
Insurance Terms Glossary
Allowed Amount – The discounted fee that the doctor agrees to accept as payment for services provided to a person with health insurance. Each insurance company has a different fee schedule that discounts the doctor’s fees. The insurance company and/or the patient pay this amount to the doctor.
Deductible - In health insurance, the amount that must be paid by the insured (patient) to the doctor before the insurance company pays anything to the doctor. This starts over once per year. If the patient has a deductible, the allowed amount for each visit will be paid by the patient to the doctor and applied toward the patient’s deductible amount.
Copay - A specified dollar amount that the patient pays to the doctor for each exam and/or treatment.
Coinsurance - A percentage of the allowed amount that the patient pays to the doctor for the exam and treatment once the deductible has been paid. The policy you signed up for may have any or all of a deductible, copay, and coinsurance.
Out-of-Pocket Maximum (OOP) – The maximum amount that the insurance company makes the patient pay within a one year time frame for the services the patient receives. Once the patient has paid an amount in deductible, copay, and coinsurance that is equal to the out-of-pocket maximum, the patient does not pay any more fees for the rest of the year. For example: If the patient has a $2000 annual OOP, $300 annual deductible, and a $20 copay, the patient pays the doctor the full allowed amount for each treatment until he or she has paid $300 toward the deductible. After the deductible is met, the patient pays the doctor the $20 copay amount for each visit and the insurance company pays the rest of the bill to the doctor. Once the patient has paid a total of $2000 for deductible and copays, the insurance company pays the total allowed amount for each treatment to the doctor for the remainder of the year.
Explanation of Benefits (EOB) – This is the statement that your insurance company sends to you and to the doctor. It shows what the doctor billed, what the allowed amount is, how much the patient must pay, how much the insurance company will pay, and how much the doctor must write off.