Medical care is an integral part of human life. During a visit to a doctor, a person can be very stressed about his or her health condition. However, even more, stress can be caused by the complicated payment system patients face when paying for health care services. When learning in medical university, future physicians must understand not only medical specialties but also be able to explain the payment system to the client intelligently. After all, when a person comes to get help with his health problem, he expects support from the staff in all areas of contact with the system. This paper will first look at the main types of medical payments and then give an example scenario of how they can be applied in practice.
The first term I want to discuss is out-of-pocket expenses. These are expenses that are not covered by insurance, and one needs to pay on their own. Out-of-pocket expenses include co-insurance, co-pays, and deductibles which have a maximum that limits the amount one must pay each year to cover medical charges. Some of these expenses can be deducted right from one’s income. While in the hospital, a person’s out-of-pocket expenses may include lunches or additional medications not provided by the facility.
Co-payment is a fixed amount paid by a patient before receiving medical care. It is usually delivered to the provider of service. It can also be described as an insurance policy paid by patients every time they receive medical services. Co-payments do not contribute to any policy concerning the out-of-pocket maximum (Kagan, 2021b). The latter limits the amount of money that one has to pay for their yearly health plan. Insurance companies use these payments to contribute to healthcare costs to prevent hazards from happening. However, co-payments sometimes discourage people from looking for necessary treatment and medical care. When the co-payment cost is high, they may fail to pay, making them uninsured, and leading to unaffordable health care.
Co-insurance is a percentage of the cost one pays in a covered health care service. It is produced after one has already paid the deductibles. After payment of deductibles, one pays a percentage of what is left of the cost, and the out-of-pocket maximum covers the rest. Low monthly premiums are associated with higher co-insurance, while higher monthly premiums are associated with lower co-insurance (Kagan, 2021a). Co-insurance breakdowns are usually an 80/20 split. The patient has to pay 20% of the costs incurred on medical services.
A deductible is the amount paid for an insurance plan before it starts covering one’s medical expenses. After payment of a deductible, one only pays for co-payments and co-insurance. Some plans may pay for disease management programs before the deductible amount to attract people to use the method (Tataaig, 2021). Some insurance companies also have specific goals for different services, for example, prescription of drugs and dialysis. Plans that cover families have an individual deductible that covers every person in the family. There can also be a family deductible which is paid once to cover all the family members. Like co-insurance, low monthly premiums have higher deductibles while high monthly premiums have lower deductibles. To pick a policy with a high or low monthly premiums deductible, one should consider the yearly medical premiums.
In my last year in high school, I discovered that I had kidney stones which had given me many health problems, and I needed surgery and treatment. I paid a visit to a doctor who referred me to a specialist. On my first appointment, I had to pay a co-payment of 30 dollars and discuss my treatment plan, which included surgery. His secretary contacted my insurance, who reminded me of the 2000 dollars I still owed for my deductibles. The cost of my dialysis amounted to 4000 dollars and the prescription of drugs 500 dollars. I paid my deductible to be able to plan my surgery. I went into agreement with my insurance company for a breakdown of 80/20 split on my co-insurance, which meant I had to pay 625 dollars.
References
Kagan, J. (2021). Co-insurance. Investopedia. Web.
Kagan, J. (2021). Co-pay. Investopedia. Web.
What is a deductible in health insurance? Tataaig. (2021). Web.