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All You Ever Wanted to Know About Insurance

Health Insurance 101

“What’s a Premium again?”

A new survey of 1,008 U.S. adults conducted for the American Institute of CPAs by Harris Interactive, found that more than half (51 percent) could not accurately identify at least one of three common health insurance terms. They are: premium, deductible and co-pay.

A third (34 percent) thought a premium was an expense at the time of receiving medical service or a prescription; more than a quarter (27 percent) thought a co-pay was the cost of obtaining insurance; and 12 percent did not know a deductible is the money one pays before an insurance company makes payments.

Not surprisingly, just as consumers struggled with basic health insurance information, the majority of Americans were unaware of the Patient Protection and Affordable Care Act and its implications.

Forty-one percent said they are not at all knowledgeable about the law and another 48 percent said they were only somewhat knowledgeable. Young people were the least knowledgeable, with nearly half (48 percent) of adults aged 18 to 34 saying they had no knowledge.

Health Insurance 101

Here is a great refresher for even the more seasoned health insurance seekers.

Words Worth Knowing

For those who are in the midst of comparing coverage options, it’s best to first refresh your health-insurance vocabulary:

  • Premium – the amount of money that must be paid for your health insurance plan. You and/or your employer usually pay the premium monthly, quarterly, or annually.
  • Coinsurance – your share of the costs of a covered health care service, calculated as a percent (for example, 20%) of the allowed amount for the service. You pay coinsurance plus any deductibles that you owe. For example, if the health plan’s allowed amount for an office visit is $100, and you’ve met your deductible, your coinsurance payment of 20% would be $20.
  • Copays – a fixed amount (for example, $15) that you pay for a covered health care service, usually when you receive the service.
  • Deductible – the amount you owe for health care services that your health plan covers, before your health begins to pay. For example, if your deductible is $1,000, your plan won’t pay for anything for certain services until you’ve met your $1,000 deductible.

Extra Tip: As a general rule, lower monthly premiums are accompanied by higher copays, coinsurance, and deductibles. Similarly, plans with higher premiums, will have lower copays, coinsurance, and deductibles.

Partner Agency Insurance Services, Inc. can provide you with professional expertise in understanding your health care options, guidance in application and eligibility process plus offer you affordable health care coverage through Covered California or directly with medical insurance carriers for Individuals and Families or Employer Group coverage for groups of any size. Please feel free to contact us for a complimentary quote from various companies for almost any kind of insurance, including homeowner’s, auto and commercial at (714) 482-9500 and mention this blog post!


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