Whether you’re new to health and dental insurance or you’ve had coverage for years, it’s not uncommon to encounter words or phrases that are unfamiliar to you.
And while there’s no reason you would know what they mean – you’re not in the insurance business, after all – a working knowledge of these industry terms is essential to ensuring you’re getting the most out of your coverage and you’re not misunderstanding important details along the way.
That’s why we made this glossary of common health and dental insurance terms, decoded into simple and straightforward language we can all understand.
Premium
Just like the premium you may pay for car or life insurance, a health insurance premium is a regular payment you make to your insurance provider in exchange for the coverage you were approved for.
When you have workplace health benefits , the premium is often shared between you and your employer. When you have individual health insurance, however, you’re responsible for the entire premium.
Premiums are usually charged monthly or sometimes yearly.
Deductible
A deductible is an amount of money you will need to pay out-of-pocket before your insurer will cover the rest of the cost for the claim. This varies from plan to plan, so check out your individual personal insurance policy.
Coinsurance
Coinsurance kicks in when your policy doesn’t cover 100 percent of something, and instead lays out that they’ll cover up to a certain percentage of a medical cost. This is usually accompanied by a maximum annual amount you can claim.
Copay
Most health and dental insurance plans offer a specific, pre-defined amount of coverage for medical costs. The co-pay (also known a co-payment) is any cost above and beyond that amount, and you’re responsible for paying out-of-pocket.
Out-of-pocket expenses
Healthcare costs that aren’t covered by insurance, and that you pay for with your own money are called “out-of-pocket” expenses.
Exclusions
Things not covered under health insurance such as experimental products or treatments, or cosmetic products or services.
Dispense fees
A fee charged by a pharmacist to fill a prescription. Your insurance plan may only cover a certain amount for dispensing. Above that amount, you’ll have to pay.
Dependent
When it comes to health insurance, your dependent can be your spouse or partner, and any children you have. Your dependents are covered under your plan which means they could be entitled to benefits you might have through your workplace or a personal plan you hold. FYI: This doesn’t happen automatically, so make sure you add any dependents at the same time you apply for coverage for yourself, or as they enter your life, such as when a child is born. It can vary, but most plans allow you to keep your children on your plan until they turn 18 or 21, or up to 25 if they’re studying full-time at a recognized educational institution. If they get married before this age, they’re generally no longer eligible for coverage under your plan.
Waiting period
When your health insurance coverage starts, there may be a period of time when you aren’t able to use some (or all) of its benefits. This can apply to treatment for certain conditions or certain services, like dental care. It can vary, but anywhere between 30 days and 3 months is fairly standard.
Coordination of benefits
When someone is covered by more than 1 benefits plan, the plans work together to pay any claims.