Heath Insurance 101
OFFICE HOURS: Monday – Thursday: 8:00am to 5:00pm • Friday: 8:00am to 3:00pm
AFTER-HOURS CRISIS SUPPORT & VICTIM ASSISTANCE: 303-615-9911
Health Insurance 101
Most people in the United States are required to have health insurance coverage by Federal Law, but there is no universal healthcare system in place. Having a health insurance plan protects people from owing a lot of money to medical facilities or hospitals if they experience illness or injury.
People may have their health insurance partially or fully paid for by their employer. This plan may cover spouses and dependent children up to age 26. Others can buy health insurance through the Connect for Health Colorado Marketplace, a broker who sells healthcare plans or a University offered healthcare plan while attending school.
In addition, some people may have a United States government funded healthcare plan, such as Medicare and Medicaid. These insurance plans are offered through an application process. They are designed for the elderly, disabled, children and low-income populations.
Health insurance is necessary to be able to pay for the high cost of healthcare in the United States. Healthcare in the U.S. is expensive and all students should consider having some kind of healthcare coverage while attending school. An average 3-day hospital stay in the U.S. could end up costing over $30,000 dollars. (Source: Healthcare.gov)
Understanding Health Insurance
When it comes to deciding on insurance coverage, whether it’s the University offered insurance or another plan, understanding plan language and how the specific plan works will help you minimize your overall out of pocket medical costs.
Oftentimes the insurance premium is only the beginning of your costs. Should you need medical treatment while enrolled on a health insurance plan, understanding your insurance plan obligations ahead of time can help you plan financially to avoid unexpected costs.
Each year, you’ll pay out of pocket costs for health insurance coverage. First, there is the premium that you usually pay upfront to have health insurance coverage. Most plans have a deductible or copay responsibility, which is a specified dollar amount you have to meet before your insurer begins sharing in paying expenses, called coinsurance.
Coinsurance is the cost that is shared between the insurer and the member, after the deductible is met. Depending on your plan, the insurer typically pays around 80% and the member pays around 20% of charges. A copay is an amount that is paid at the time services are rendered, specific to your plan.
If you’re injured or become ill you will have out-of-pocket expenses; very seldom will an insurer pay 100% of medical charges. Keep in mind your copay will apply first (if applicable), then deductible, followed by coinsurance, before the insurer pays anything towards your medical bills. This is called cost sharing, sharing the costs between you and your insurance company. After you’ve met your deductible and/or paid a copay and/or coinsurance, your health insurance plan will help pay your remaining balance, saving you money in the future.
Whether it is flu season or you suffered a minor injury, you should always visit a healthcare provider that’s in-network. A network is a group of medical providers that partners with your insurance company, making their services more affordable. The cost to see a medical provider out-of-network is generally higher, or may not be covered at all by your plan, and may result in non-covered charges. Be sure to check for any out of network benefits on your plan. Even if your plan has out-of-network benefits, the out-of-network provider can balance bill you, which is the remaining balance that insurance didn’t cover. Each time you visit a medical provider they will bill your insurance first, then bill you for your portion of the costs.
There are many places where you can seek medical care depending upon the severity of your illness or injury. An in-network health clinic or medical office offers the best option for cost savings. If it’s after hours, a local Urgent Care clinic can treat most illnesses and injuries. Either of these will cost far less than a visit to a hospital emergency room (ER).
Urgent care is not Emergency care. Urgent care centers are same-day clinics that can handle a variety of medical problems that need to be treated right away, but are not considered true emergencies. While urgent care clinics are not a substitute for your primary care physician, they are a great resource when you need immediate care but can’t get in with your doctor.
Emergency Room care is for medical symptoms that need to be evaluated right away. There are a number of medical conditions that are considered emergencies because they require rapid or advanced treatments (such as surgery) that are only available in a hospital setting. Visit an ER immediately if your condition is life threatening or if you need urgent care when other clinics are closed.
Insurance Glossary of Terms
Premium: The amount paid for your health insurance or plan.
Deductible: The amount you owe for covered health care charges before your health insurance or plan begins to pay. For example: if your deductible is $1000, your plan won’t pay anything until you’ve paid your $1000 deductible for covered health care services. The deductible may not apply to all services
Corridor Deductible: A second-order deductible on the plan, it acts as a corridor between the first and second level of coverage. Level 2 coverage will only be accessed by maxing out the primary coverage (level 1) and paying this second deductible. The Corridor Deductible starts over every year.
Coinsurance: Your share of the costs of a covered health care service, calculated as a percentage of the allowed amount for the service. You pay coinsurance plus any copay and deductibles you may owe. For example: if the health insurance or plan’s allowed amount for an office visit is $100 and you’ve met your deductible and paid your applicable copay, your coinsurance payment of 20% would be $20. The health insurance or plan pays the rest of the allowed amount.
Co-pay: A fixed amount you pay for a covered health care service, usually when you receive the service. The amount can vary by the type of health care service, provider and plan.
Out of Pocket Costs: Out-of-pocket costs refer to the portion of your covered medical expenses that you can expect to pay during the course of a plan year. Your out-of-pocket costs can include a combination of your premium, health plan’s deductible, copays and coinsurance.
Out of Pocket Limit: The most you pay during a policy period (usually a year) before your health insurance or plan begins to pay 100% of the allowed amount. This limit never includes your premium, balance-billed charges or health care your health insurance or plan doesn’t cover. Some health insurance or plans don’t count all of your co-pays, deductibles, co-insurance payments, out-of-network payments or other expenses toward this limit.
Provider: A provider is a medical professional who provides medical care. They may have a contract with your health insurer or plan to provide services to you at a discount. Check your policy to see if you can see all preferred providers or if your health insurance or plan has a “tiered” network and you must pay extra to see certain providers. Your health insurance or plan may have preferred providers who are also “participating” providers. Participating providers also contract with your health insurer or plan, but the discount may not be as great and you may end up paying more.
Network: The facilities, providers and suppliers your health insurer or plan has contracted with to provide health care services.
Non-Covered Charges: Costs not covered by your health insurer or plan.
Balance-Billed Charges: When a provider bills you for the difference between the provider’s charge and the allowed amount. For example: if the provider’s charge is $100 and the allowed amount is $70, the provider may bill you for the remaining $30. A preferred provider may not balance bill you for covered services.
Preferred Provider Organization (PPO) Plan: A type of health insurance plan. The plan lets members use any health care provider, but it will usually pay more of the member’s costs when they receive services from network providers. A PPO plan is also known as a managed care plan.
Preventive Benefits: Covered services that are intended to prevent or identify disease while it is more easily treatable.
Preventative Care: Health care services that help prevent disease. Flu shots and Pap smears are examples of preventive care.
Benefit: The amount of money an insurance company will pay for your health care and other services.
Claim: A request by a plan member, or their health care provider, for the insurance company to pay for medical services.
Formulary: A list of prescription drugs that are paid for by a health plan
Exclusions: Services not covered by the plan, services your insurance does not pay for.
Explanation of Benefits (EOB): A statement that gives all of the details about what the health insurance plan covered, what the plan did not cover, how much money needs to be paid, and more.
Evidence of Coverage: A summary that tells you what your health plan will and will not pay.
Health Insurance Resources
MSU Denver Student Health Insurance
Coordination of the MSU Denver Student Health Insurance Plan.
Plaza 150 | 303-615-9997
CU Denver Student Health Insurance
Coordination of the CU Denver Student Health Insurance Plan.
1380 Lawrence Street, Suite 932 | 303-315-0232
Connect for Health Colorado
Colorado’s Official Health Insurance Marketplace.
The website for Health First Colorado (Colorado’s Medicaid Program).
Website dedicated to understanding the Affordable Care Act and additional health insurance resource information.CU