Difference In Deductible & Out of Pocket Costs Under Medical
Terminology for medical insurances can seem confusing compared to dental care. While there are generally less moving parts to keep track of (services generally are covered at a standard percentage before the deductible and OOP) if you aren’t familiar with the lingo you can easily get stumped while trying to explain a patient’s benefits to them. Some helpful terminology lessons:
Deductible – this is the amount the patient must pay before their health insurance begins paying for ANY services. The only services exempt from this are diagnostic and yearly preventative visits (as well as well woman visits and prenatal care) due to the Affordable Care Act. If you are having surgery, non-diagnostic imaging or seeing a specialist or having a sick visit this amount could come into play.
Out of Pocket Maximum – the patient’s coinsurance (or shared financial responsibility) for procedures goes towards this maximum. For example, if a patient has met their deductible and services are covered at 40% but they still have an out of pocket maximum left then they will pay 40% of procedures until they have satisfied that out of pocket maximum.
Coinsurance – the portion of a procedure that the patient is responsible for. If a procedure is covered at 40% then the patient’s coinsurance is 60%.
Allowable Amount – most dental providers are considered out of network with medical insurance policies. If there are providers in-network in the surrounding area than most of the time the insurance carrier will pay based on the “allowable amount”. This is the insurance’s fee schedule. The patient will be responsible for anything over that amount since they chose to not see an in-network provider.
Gap Waiver – this is a request a provider can make to an insurance with which they are not a participating provider to be treated as a participating provider for the particular date of service and procedures specified. Providers may do this if the patient isn’t going to do treatment because of out of network costs or if the patient has no out of network benefits. Generally the reimbursement from the insurance will be higher by percentage but you will be bound by their fee schedule ultimately leading to less reimbursement.
Using proper terminology with patients is essential to maintaining cohesive care. If you are using your own terms for things and the patient calls their insurance carrier and gets a whole difference set of terms they may lose confidence in your team. Think of how much we cringe when a patient refers to a crown as a “cap”. Words matter and the names for certain functions under the insurance can strengthen your patient’s understanding of both their benefits and the treatment you are delivering.