With health insurance adoption picking up in India, the health plans are getting evolved and getting more customer-centric. While buying health insurance is critically important to avoid the financial burden that comes on you and your family, choosing the right one seems a tedious task as well.
With this plethora of health insurance, choosing the right kind of health plan seems a strenuous task. Still, with proper guidance and thorough understanding of the world of health insurance, you are all set to make the right decision for a secure and safe future for yourself and your loved ones.
What is a health insurance network?
A health insurance network refers to a group of hospitals, clinics, medical professionals and medical institutes that have a contract with the health insurance carrier which ensures to provide the health care services at a discount and accept the discounted price as the full payment.
Your health insurance plan can be either cash or cashless. You need to look out for the cashless feature while buying health policy.
Even this network can be categorized as:
- Out-of-network: The doctors / hospitals that fall in the category of out-of-network are the ones who don’t have any contract signed with your health insurer, and often availing the services from such doctors are costly. Out-of-the network insurances are cash-based insurances that require the patient to pay his/her medical bills on his visit to the hospital, and later get the medical bills be reimbursed by the respective health insurer.
- In-network: Every doctor / hospital that signs the contract with the health insurance company falls in the in-network, and they are liable to charge you the decided health care fee only and not their actual charges. In-network, you are offered with the cashless health insurance features which remove the hassle of paying money at the hospitals. Cashless health insurance makes your insurer to pay your medical bills directly on your behalf.
Some of the health insurance plans cover only in-network doctors, and some include both the networks. Both these networks differ in the amount you have to pay for your medical expenses. So, neglecting this feature is not the right choice.
Health insurance cost-sharing plans
Before getting into understanding the working of insurance plans, let us brush up on some of the health insurance cost-sharing plans.
- Premium: A premium refers to the monthly or annual payment paid to keep up the insurance plan. These are the regular payments made by the respective individual to the insurance company for keeping the insurance plan active.
- Copay: Copay is a predetermined flat fee or fixed amount that you pay for your routine health care services defined in your plan.
Let’s understand this by taking an example, Your plan includes a copay or fixed amount of the healthcare services like visiting a primary care physician, an emergency room visit and some generic prescriptions which are respectively 1K, 10K, and 0.5K respectively. Every time you visit a doctor for the mentioned services, the amount remains the same irrespective of how long the visit was or the cost of the drug prescribed. All these costs are covered in the copay amount itself.
- Deductible: Deductible refers to the amount that has to be paid out of your pocket for all the healthcare services (includes surgical operations, hospitalizations or blood tests but excludes the routine healthcare checkups ) before the health insurance pays anything.
For instance, having a 10K deductible means you have to pay out of pocket 10K, and after that, the insurance plan will cover the higher portion of costs. Also, the value of deductible resets every year.
- Coinsurance: Coinsurance is the percentage of a total medical expense that is paid by you, and the health insurance plan covers the rest. It applies after you have met the deductible.
For example, if your plan includes 20% coinsurance, then you have to pay 20% of the medical bill from your pocket, and the rest 80% is covered by health insurance.
- Top-up plans: It is an add-on plan for your health insurance policy, enabling the feature of using additional cover once you exhaust the amount of the existing health plan. You need to note that the top-up plans have a threshold value and they cover only the single hospitalization bills of the respective patient.
You can buy the top-up plan and decide its threshold limit based on the existing health policies.
How do they all work together?
Different companies offer varied health insurance plans that as per their set of terms and conditions include different premiums, copay, coinsurance, and other cost-sharing amounts. It depends on you to make your decision wisely and choose the right health insurance that will bring a bundle of health benefits for you.
Now, with brief knowledge about the cost-sharing plans, let’s see how all these integrate to work together and serve as an optimal health policy for you.
It starts by paying the monthly or annual premium amount of your chosen health plan. Now on your visit to the doctor either you have to pay entirely for all the services availed, or you can use the copay as outlined in your insurance plan.
Once your paid medical expenses’ amount excluding the copay adds up to your deductible amount, your respective insurer will start off paying the more significant portion of your medical bills that will be about 60% to 90%.
Until you reach the out-of-maximum-pocket amount, you have to pay the copays or coinsurance. Once you achieve that, your insurer is obliged to pay all your medical bills 100% until your policy year ends or there is a plan for switching to another policy.
The bottom line
In today’s era, where health insurance has found its place in the essentials for you and your family, it is becoming difficult to find the right plan for a secure future.
So, it becomes imperative for all those making up their minds to buy health insurance to do adequate research and then choose your health policy. Be thorough enough with every term and condition that you sign on.
The above cost-sharing plans and their working are essential to understand to make the right choice related to the policy you have to buy.
It’s your money and mind that will pave the way to benefits or harm.
About Ayu Health
Ayu Health is India’s most trusted network of hospitals. Our specialists provide unmatched care across a range of specialties. Our hospitals typically accept all major insurance schemes and provide cashless coverage to patients.
To book a consultation with a doctor, please visit Ayu Health or call us on 08069489584.
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About the Author
Dr. S. Goel
Dr. S. Goel is a renowned Internal Medicine Specialist currently practicing at Ayu Health, Bangalore. He is a Specialist in Internal Medicine, Diabetes HTN, Paediatric Care, and Family Medicine.