How Health Insurance Works

Health Insurance Glossary –

  •  Open enrollment is the period of time during which an individual can enroll in a health insurance plan. Open enrollment for individuals to purchase 2016 health insurance plans has ended. Open enrollment for 2017 is November 1, 2016 through January 31, 2016. Individuals may be able to apply for individual health insurance outside of open enrollment if they have a qualifying life event or had trouble purchasing a plan in the Marketplace during the open enrollment period. Click here for more information about special enrollment opportunities.
  • A deductible is the amount of money you’ll need to pay before your insurance begins to pay.  For example, if you have a $2,000 deductible, you will pay for the first $2,000 of health care you receive in a year before your insurance begins to pay for anything.

Your deductible may not apply to all services. For example, your insurance must pay for preventative health care or other services even if you haven’t paid your full deductible, yet.

  •  A co-pay is a fixed dollar amount you pay for a covered health care service. The amount you pay can vary by the type of service (for example, an office visit or seeing a specialist). A co-pay is usually required at the time of service. So, if you have a $15 co-pay for every doctor’s office visit, for example, you’ll need to pay $15 to the doctor the day you visit. Co-pays do not apply to your deductible.
  • Coinsurance is 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 after you have paid any deductibles you owe and after you have paid any co-pays. For example, if the health insurance or plan’s allowed amount for an office visit is $100 and you’ve met your deductible, your coinsurance payment of 20% would be $20. The health insurance or plan pays the rest of the allowed amount.
  • A premium is how much you’ll pay each month for health insurance.
  • A network is a group of health care providers (doctors, hospitals, and specialists) who have signed a contract with your insurance company to provide services at a lower cost.  With most health insurance, if you receive health care services from an out-of-network provider, you will pay significantly higher out-of-pocket costs. You can find a list of a company’s provider network on the company’s website. If you are buying insurance through the federal Health Insurance Marketplace for Montana, you will find a link from that site to the insurance company site, which will include a list of network providers. Don’t assume every provider in your community is in every company’s network.

Emergency care is always considered in-network, even if the hospital where you were treated is not in your company’s network.

  •  The Patient Protection and Affordable Care Act (also known as Obamacare), often shortened to the Affordable Care Act or the ACA, is the federal health care reform law that was passed in 2010. Many important parts of the law took effect on January 1, 2014.
  • Premium tax credits are new kind of tax credits created under the Affordable Care Act designed for individuals and families to lower the amount they pay for insurance every month. The credits can be taken every month, when you file your taxes or a combination of the two. These credits are available only through the health insurance Marketplace and will be paid directly to your insurance company. Whether you qualify for the credits — and how much you may qualify for — is based on your income.
  • Cost-sharing discounts are another consumer benefit created under the Affordable Care Act. Even with the tax credits, total health care costs could be unaffordable to some Montanans because plans may have high deductibles and out-of-pocket expenses. If you qualify, you could receive a discount on the amount of deductible, co-pay and coinsurance you pay.
  • Actuarial value. You may see this phrase when you start looking at insurance plans and how they compare with one another. In a nutshell, actuarial value looks at the share of medical spending paid by your insurance company compared with the amount paid by you. For example, if you have a health insurance plan with an actuarial value of 70 percent and you have a $100 doctor’s bill, the insurance company will pay $70 and you will be responsible for paying the remaining $30. Plans with a higher actuarial value will cost more every month in premium, but you will pay a smaller percentage of your actual health care costs.

Health Insurance Assistance Contact Info

1035 1st Ave West
Kalispell, MT 59901 – 3rd Floor

406-758-2165 main line
855-396-3837 fax