What’s The Difference Between Deductible and Out of Pocket Maximums

1. What’s The Difference Between Deductible and Out of Pocket Maximums?

2. It’s generally a pretty useful thing to be able to confidently explain terms like “deductible” and “out-of-pocket costs” to your patients in the healthcare industry, as these are terms that have a fairly significant impact on their overall financial planning and health insurance plan. • Subsequently, if they’re not kept in the loop and don’t really know what these mean come the time they need to pay for the services you’ve rendered, they’re not exactly going to think highly of your practice as it comes across as slightly unprofessional on your behalf.

3. Understanding Health Insurance Basics • Kicking things off, let’s start with some of the basics. Health insurance, as you probably already know, is a contract between the patient and their health insurance company in which they pay a monthly premium for the assurance that any medical care they receive will be paid for on their behalf.

4. Deciphering Deductibles • Now, obviously, health insurance plans like this are lifesavers for millions of Americans across the country given how insanely expensive covered health care services can be – but that doesn’t mean there aren’t still some out-of-pocket expenses that the patient might need to pay before there health insurance plan begins paying the bulk of it, and this expense is known as a health insurance deductible. • For instance, if your plan has an annual deductible of, say, $700, this is the amount the

5. patient is going to have to pay in medical expenses before their insurance starts covering extra costs – which there’ll certainly be no shortage of. Understanding Out-of-Pocket Maximums • On the other hand, though, the out-of-pocket maximum is basically the most a patient will ever need to pay for covered services in a plan year, so once they’ve actually hit this limit, their insurance company won’t make them pay anymore (in things like deductibles and copayments), so they’re not completely overwhelmed with healthcare costs for the rest of the year – with the exception of their monthly premiums, of course.

6. Distinguishing Between the Two • So, to reiterate, deductibles are basically the initial amount the patient has to pay before their insurance properly kicks in, while out-of-pocket maximums are the total amount they’ll ever have to pay in one year (including the deductibles) before their insurance takes over and covers 100% of your covered services. • In simpler terms, try to think of the deductible as the hurdle they need to jump over first and the out-of-pocket maximum as a sort of safety net so they’re not going into total financial ruin with the amount of deductibles they might need to pay that year.

7. Why Partner with PMN? • Both deductibles and out-of-pocket maximums are just another nuance on the medical billing side of things that are taking your staff away from their core responsibilities – looking after the patients that come into your practice. • While it certainly helps to have an understanding of these sorts of things, handling claim submissions and communicating with insurance providers is ultimately a job that’s best left to people with professional expertise, which is exactly why large medical practices hire a fleet of in-house staff to do it for them rather than delegating it to their existing physicians.

8. Smaller practices like yourselves, on the other hand, often don’t have the funds to pay for this sort of thing, and EHR software and other medical billing and coding technology come with their own complications, too – whether it’s the upfront cost you’re going to have to pay or the time spent training your staff how they work and integrating them into your practice. • As a result, you’re far better off going to a specialized medical billing and coding service such as PMN to deal with insurance providers on your behalf – not only so your claim denial rate is drastically reduced (almost eliminated, even), but because of how much more affordable and convenient it is.

9. PMN brings upwards of 20 years of experience across a range of different fields – from family medicine to less general areas like ophthalmology – to your practice, so regardless of what kind of billing or coding responsibilities your particular practice deals with on a daily basis, PMN can handle it promptly so you’re getting reimbursed as fast as possible and can spend more direct time with your patients. • If you want to know more about what PMN can do for your practice, don’t hesitate to get in touch over the phone by calling 949) 215-5055. Still, not everyone will feel comfortable making such a big commitment over the phone, so you can book an appointment at their office in Laguna Hills, Orange County, California, if you’d prefer an in-person consultation.