Eli5: How does health insurance work in the U.S?

Question

I have been working for a new company for a year now, and have been on their insurance through Aetna the entire time. It’s the first time I’ve had health insurance through work.. So I’m paying monthly out of my check for the health insurance, but then im still going to owe my health provider out of pocket at the end of the year if i don’t pile up enough medical bills?

In: Economics

Answer 1

I have sold insurance, done medical billing, and reimbursement.

Your insurance typically operates thus.

You have a monthly payment, that your employer may help cover. This is your initial cost. You will also have a deductible and a maximum out of pocket. This works this way. If you’re on a high deductible plan, your deductible can be upwards of $3500+. Or you can be on a plan with a higher monthly cost and lower deductible. You are responsible for all medical costs until your deductible is met. After that, your insurance company will pay a predetermined percentage, say 80% and you are responsible for the 20%, up until your max out of pocket is met, then the insurance will cover 100% until your annual renewal. I have seen some great plans and some that were absolutely horrible, $5,000+ deductibles with $10,000+ out of pocket. And that was just the individual. The family deduction and out of pocket were much higher.

After dealing with the criminal enterprises that are called insurance companies, from the provider side trying to get paid their expected rates, I have seen companies purposefully violate contracted agreements, knowing no one can afford to take them on. They are ripe for massive multi-billion dollar class action lawsuits. They really need to be sued into oblivion for the contract violations they perform daily. The provider I worked for had to write off tens of thousands of dollars annually because the companies refused to pay or would pay low. There is a standing letter to one of the big insurance companies that the provider’s legal team sent that said the insurance company owed them over $386,000 in incorrect payments. That’s just one company and one provider.