The way insurance works is by pooling resources together to meet an unforeseen problem. This is no difference with health insurance. This is how companies like blue cross blues shield Florida and Florida Blue get to make pay-outs to their clients. Each time premium is paid it goes into a pool that is used to pay for other clients that make claims for their insurance.
This is a simple way of looking into health insurance in Florida and how it works. There are other terms such as deductibles and maximum out of pocket that are thrown around in health insurance. These terms might confuse some people, so let’s talk about them.
What are deductibles?
To put in simple terms, the deductible is the amount that you have to pay out of your own income to meet certain health expenses. It’s only after you meet the deductible amount that the insurance company steps in to help. For instance, you have medical bills of $10,000 and an annual deductible of $5,000. What this means is that you’ll have to pay $5,000 of the expenses and the insurance company will step in to pay the rest.
This again is a simple way to look at it. There are other things such as the out of pocket maximum and co insurance that needs to be considered. All this normally depends on the arrangement that one makes with the insurance company.
Deductibles Vs Out of Pocket maximum
These are two terms that are quite similar, but different from each other. The deductible is the amount you have to pay form your own pocket. After this amount is fulfilled the insurance company steps in to help depending on the agreement set between you two.
They could pay the entirety of the medical expenses or work on a coinsurance basis, where the expenses are shared between the two of you. A maximum out of pocket is different. Is the amount that after which is attained the insurance company will cover the medical expenses fully. This is including deductibles, co-payments and co insurance.
For instance, if you have medical expenses of $20,000 and a maximum out of pocket amount of $5,000. If while paying for deductibles and co-payments, you arrive at this $5,000 the insurance will step in and cover the rest of the expenses.
What’s the maximum deductible?
There is really no maximum deductible set by law. It has to be pointed out that there is a maximum out of pocket limit for a market place plan. The limit was at $6,850 for an individual and $13,700 for a family plan.