Navigating Deductible Season: Understanding Your Insurance and What to Expect After A Visit

If you’ve ever been surprised by a higher than expected healthcare bill at the beginning of the year, you’re not alone. Deductible season can be confusing, frustrating, and expensive especially if you’re not exactly sure how your insurance benefits work. Everyone is always talking about things like deductibles, covered services, “are you in-network?”, and “check your EOB” but these terms are rarely explained in a way that actually makes sense. By understanding the basics of your insurance plan you can better anticipate expenses, avoid surprises, and feel more confident navigating your healthcare coverage. 

So what is a deductible? A deductible is the amount of money you have to pay out of pocket for covered services before your insurance starts to contribute. Your deductible is determined by your insurance carrier and will vary plan to plan. Some plans might have separate deductibles for certain services like prescription medications, or a family plan may have both an individual deductible and a family deductible. 

For example if your deductible is $1,500, you pay the first $1,500 of covered services yourself. 

In general, only payments for covered services with an in-network provider can be applied towards your deductible. A covered service is any treatment or procedure that your insurance agrees to help cover when certain parameters are met. Coverage depends on your individual plan, each plan has different coverage and parameters even under the same carrier. 

When you are in-network with a provider this means your insurance carrier has a contract with that provider or health system and have prenegotiated set rates for you, usually at a lower cost. These negotiated rates, or allowed amounts, will also depend on your individual plan and can be found in your summary of benefits and coverage usually in your insurance member portal. 

For example if an hour long psychotherapy session costs $150, your negotiated in-network rate may be $100. 

After your visit your provider will send a claim to your insurance company. Your insurance reviews the claim and determines if the service is covered, if the provider is in-network, if it was medically necessary or any other details they need to verify based on your plan parameters. Once the claim is processed your insurance will send you an explanation of benefits (EOB) outlining what was billed, what the negotiated or allowed amount is, how much they are covering when applicable, and what is your responsibility. This is not a bill, just a summary meant to help you understand how your benefits were applied. Your provider will then send you a statement for your remaining balance, this amount should match what is shown as your responsibility on your EOB. The whole process can take anywhere from a few days to several weeks.

For our example your EOB would show: 

60min Psychotherapy session 

Total billed ………………………….…. $150.00 

Negotiated (in-network rate) …. $100.00 

Patient responsibility: ……………. $100.00 

Until you meet your deductible, you are responsible for paying the full in-network rate for your covered services. Every year your deductible resets; For most this happens on January first- hence deductible season. Because of this you end up paying more out of pocket for services that previously may have cost less, or were even covered entirely. 

In our example after paying the $100 statement, your deductible is now at $1,400. Once $1,400 more is paid out of pocket, whether it be continued psychotherapy appointments or other covered services, insurance will begin sharing the costs. 

Not all services we offer are billable to insurance, like our IV ketamine infusions or our CBD. If you are seen for a covered service and purchase additional wellness services or items that are not covered only the amount paid out of pocket for the covered service can be applied to your deductible. Although these services cannot be billed to your insurance or count towards your deductible, you may be able to use your HSA or FSA account to cover some expenses. 

Once you have met your deductible your insurance will begin sharing the costs with you, but this does not mean you won't have any out of pocket expenses. Most likely you will be responsible for a copay or coinsurance depending on the service. A copay is a fixed amount for certain services that is due at time of appointment, they are usually printed on the front of your card. Some plans require a copay before your deductible is met so that routine visits have a small, predictable cost even early in the year. Coinsurance is a percentage of the negotiated rate you pay for covered services. You will be responsible for these based on your individual plan until you meet your out of pocket max for the year. You can find your copays, coinsurance percentage, and out of pocket max in your plans summary of benefits and coverage. 

Let’s say you have met your $1,500 deductible. Your plan outlines that you have a $30 copay for psychotherapy appointments, a 20% coinsurance for in-network covered services, and an out of pocket max of $5,000. 

You know you can expect to pay $30 weekly at your psychotherapy appointments. 

You also have a doctor appointment at a negotiated rate of $200. With a 20% coinsurance you know you can expect to get a statement from your provider for $40 after the claim is processed. 

You also know you can expect to continue paying copays and coinsurance until you have paid a total of $5,000 out of pocket, including your deductible.

Every plan is different, even under the same Insurance carrier. They each have unique parameters for coverage and nothing can be assumed or taken for granted. Even if you haven’t changed plans it is always important to go over your summary of benefits and coverage in the new year; any changes employers or carriers have made go into effect when the plan resets and may affect your benefits. The best advice for navigating deductible season is to understand your individual insurance plan. At the very least, make sure to know your out of pocket responsibilities so that no statement comes as a surprise. 

If you are having trouble understanding your insurance plan or have any questions about your benefits be sure to use your resources! There are dedicated member lines to help you better understand your plan, the phone number can typically be found printed on the back of your insurance card or in your member portal. It's worth the hassle of taking a day to navigate the confusing world of insurance for a year of peace of mind knowing you can anticipate the costs of your routine healthcare. 

If costs are becoming a barrier to necessary care, speak up to your provider sooner rather than later. Every provider has different protocols, but there are options and they may be able to help.