How Does My Coinsurance Work with my NC Health Insurance
When you are looking for NC health insurance make sure that you know what the coinsurance is on the plans you are looking at and how they work for the different carriers. In general, coinsurance is the amount that you are responsible for paying once your deductible has been met. Unlike a co-payment, which is a fixed-dollar amount, coinsurance is expressed as a percentage (Typically 20%, 30% or 50%). For example, many insurance plans have 20% coinsurance for hospital costs — meaning once the deductible is satisfied you are responsible for 20% of the total cost usually capping out at a certain limit known as the Stop Loss.
The Stop Loss limit is something you need to make sure you understand because this will have an impact on your overall financial responsibility. This is rather confusing for people who don't deal with it everyday. Stop Loss is expressed in terms of dollars - $10,000, $15,000, or even $20,000.
Let's look at an example:
- Carrier A has a plan with a $1,000 deductible, 80/20 coinsurance with a Stop Loss limit of $20,000. This means that once the $1,000 deductible has been met you will be responsible for 20% of the next $20,000 in charges. Once this $20,000 in charges is accumulated then the plan will cover 100% for the rest of the plan year.
With the above example an individual on the plan is exposed to $5,000 per plan year for charges that are subject to the deductible and coinsurance. Compare this to a plan that has a Stop Loss of $10,000 (all other factors being the same) and the out of pocket exposure is reduced to $3,000 ($1,000 deductible + $2,000 coinsurance).
Most NC health insurance carriers limit the policy to only 2 coinsurance maximums per plan year. However, make sure that you verify this as some carriers have coinsurance for everyone on the plan which will drastically increase your out of pocket exposure.
The below video is a good explanation of how the coinsurance works.