YOUR HEALTH INSURANCE
The word deductible is one that most of us will encounter relative to our health insurance. As we preach continually in this column, you will be able to maximize your benefits, minimize your out of pocket expenses, and reduce your frustration level if you understand how your insurance works. Simply stated, a deductible is the amount of money you must pay out of your pocket first, before benefits are payable.
Most health insurance policies have a deductible per calendar year. This means January through December. Yesterday we had two clients call telling us that they just met their deductible in December so will "that be good for 2011?" The answer is an emphatic no. January first starts a new deductible year. I had an unfortunate client several years ago get admitted to the hospital on December 31st with a heart attack. It was the first time she used her health insurance that entire year. The $2500 deductible was applied to the hospital bill and the very next day, January 1st, another $2500 was applied to the deductible. That is what is meant by "deductible per calendar year." It starts over again every year.
An important point to keep in mind: just because a charge went towards your deductible does not mean it was not covered. Frequently people will call our office stating that a medical charge was not covered when it was actually applied to the deductible. A charge not being covered is very different from a charge being applied to your deductible. Do not confuse the two issues.