What Is Deductible In Medical Insurance?
Simple breakdowns of medical terms by experts
Well, if you’ve been exploring medical insurance options, you may have encountered the term ‘deductible.’ That word that really isn’t confusing, but seems very confusing at the time you’re reading the insurance T&C’s.
It’s a crucial component to understand in medical insurance, especially if you’re an international nomad contemplating living abroad or already living abroad.
So, I’ve written this blog article to help explain what a deductible is in medical insurance, tell you why it is significant, and help you make an informed decision as to which plan might suit you best.
SPOILER ALERT: Try to avoid medical insurance plans that are giving you deductibles. We don’t do any deductibles because we believe you should not go out of pocket, instead your insurance should pay.
For those keen on understanding the costs involved in medical insurance, this is a perfect place to start. The cost of medical insurance will vary based on the deductible. Anyway, let’s get to those points shortly.
I want to help you understand why it’s important, what you should know about it, the different types of deductibles and finally answer some FAQs that we get a lot of the time from our own customers, similar to yourself.
Definition Of Deductible In Medical Insurance
Ok, here is my simplified definition of what deductible means:
A deductible is the amount you pay for healthcare services before your insurance starts to cover costs.
Example of a deductible in a real life medical insurance situation:
If your plan has a $500 deductible, you will need to pay the first $500 of covered medical expenses yourself. After you’ve met the $500 deductible, the insurance company will then begin covering a percentage of your healthcare costs according to the terms and conditions of your policy.
So in simple terms, it’s a way insurance companies can take back a little bit of what they are going to pay out. This is why we don’t do any deductibles in our plans, instead you are fully covered without having to pay anything.
Why Is Knowing Your Medical Insurance Deductible Important?
So why is this important for you? Well, knowing your deductible is crucial for understanding your financial responsibility in your medical insurance plan. If you didn’t know that you even had a deductible, you might be left with a nasty shock bill.
Being aware of this amount helps you manage your healthcare expenses as well, so it’s important for nomads, expats to keep track of your spending especially when it comes to healthcare.
To be honest, you should really choose a plan that suits you, and doesn’t do deductibles. They are a way insurance companies can just make more money. Good coverage plans like ours, will not make you pay a deductible.
I wanted to make you aware of this because no one likes to get slammed with out of pocket costs, let’s be realistic. Therefore, choosing a plan without deductible should be a priority here.
What Are The Different Types Of Deductible In Medical Insurance
Ok, so now we understand that in medical insurance, a deductible is the amount you pay out of pocket before the insurance coverage starts. Now, it’s time to find out what different types of deductibles you might have (Yes, I know. Medical terms are confusing).
Anyway, here’s a few of the different types of deductibles:
Annual Deductible: This is where you pay a deductible once a year for all medical services.
Per-Event Deductible: Paid for each separate medical incident. This is probably most common.
Family Deductible: A cumulative amount for all family members on the plan. Only really necessary for families who are overseas.
Per-Month Deductible: Paid monthly, regardless of medical services utilised. This can be good and bad.
These are some of the terms and deductibles to look out for, and try to avoid. With companies offering stuff like this, it may seem harmless but you are going to have to pay for it.
Each type of deductible is going to impact your total healthcare costs differently. Being well-informed about what is deductible in medical insurance is crucial when choosing a plan so you don’t get a bad deal, or don’t have any nasty shocks at the end.
Remember, always choose a plan that does not make you pay deductibles and still offers the same level of coverage. This is so important.
High Vs Low Deductible In Medical Insurance
Ok, so another hot topic that I always get asked is high vs low deductible. Again, avoid these at all costs.
So high-deductible plans generally have lower monthly premium payments. However, you are going to be required to pay more out-of-pocket before insurance kicks in.
On the other hand, here we have low-deductible plans. Now these offer higher monthly premiums but will cover your costs sooner.
If you see any of these on your coverage or insurance plan, get rid of it. Change over to something that has the same coverage without having to pay deductibles. You can get peace of mind from your medical insurance that way, knowing you’re not going to land any excess bills.
So, in summary if you see high or low deductibles, probably don’t choose that insurance provider. Especially if it’s travel insurance. There is a big difference between medical insurance and travel insurance.
FAQ’s About Medical Insurance Deductible
Is a Higher Deductible Better?
No. It’s worse. You shouldn’t be paying less on your coverage to then pay more incase of an emergency. You shouldn’t be paying a deductible altogether. With genuine medical insurance, like ours, you won’t need to pay any deductibles and still be fully covered.
How Often Do I Pay It?
Every insurance company is different. With us, we offer NO deductibles. You don’t expect you to be paying anything out of pocket when you are with us. We also pay hospital bills directly so nothing goes through your accounts.
Does Insurance Pay for Anything Before the Deductible is Met?
Of course, this all depends on the insurance provider you are with, but with us we will pay everything before the deductibles are met, because there is no deductible. So you are 100% fully covered without having to pay any out of pocket money.
What Happens After I Meet the Deductible?
That’s when insurance companies will finally start paying your medical bills. But let’s be honest, do you want to take the risk of relying on insurance providers to help you if they are not going to help unless you pay a % of the medical bills they are meant to be covering?
Doesn’t sound like good coverage or medical insurance to me…
Well there you have it. We’ve pretty much covered all areas of what the hell a deductible is in medical insurance terms.
Let’s do a quick recap together. Why did this even matter? Well, understanding the concept of a medical insurance deductible lets you know why you should avoid this because it’s going to leave you out of pocket and usually is offered by untrustworthy providers.
Now, we covered the different types of deductibles in medical insurance to avoid and why you should not opt for any of these options as genuine insurance providers will tend to not claim any deductibles on your plan.
For international nomads exploring different healthcare systems, being aware of what is deductible is a financial safeguard. It lets you filter good insurance providers vs more risky ones.
Anyway, if you have any questions, share them in the comments below! Don’t hesitate to comment on any good stories or fun facts either.