A beginner's guide to understanding health insurance

What is a deductible? How do I find out what my copay will be? 

Sound familiar? Don’t worry – we know health insurance can be complicated and we can help you understand your plan. We’re outlining the most common terms that often confuse our members.

When signing up for your health insurance plan, you agree to pay a monthly fee to Blue Cross and Blue Shield of North Carolina (Blue Cross NC). This monthly fee is called a health insurance premium.

Your premium stays the same each month until your plan expires. You’ll want to pay your premium on time each month so your plan remains active.

Benefits are the services you receive from your health insurance company.

You can find a list of your benefits in the coverage documents you received in the mail. You’ll notice that some benefits are covered and some that are excluded.

Covered services and treatment can be filed as a claim, but that doesn't mean the plan will pay 100%. In most cases, you'll pay a percentage of the cost, depending on your plan's deductible, copayments, and coinsurance.

Covered at 100%, which includes preventive care¹, means there is no extra cost to you. This distinction is important because this can often be confused.

If you ever have questions about what’s covered or not, just call the number on the back of your member ID card. Our Customer Service team can help.

If you had a health problem before your health insurance took effect, then you have a pre-existing condition.

What are pre-existing conditions? Common pre-existing conditions include asthma, cancer, high blood pressure, and diabetes.

We won’t refuse to cover you or charge you a higher rate because of your pre-existing condition.

It is crucial to make sure you have a primary care doctor selected and that you set up annual checkups and other preventative care in advance.

A major decline in health begins at age 27, according to the Blue Cross Blue Shield Association Health of America report.

Primary care is the best place to start for most of your health care needs. It’s where you can get treatment for minor illnesses and injuries and get help with chronic conditions.

Excluded services are things that aren’t covered by your health plan. You’ll have to pay out-of-pocket for these services.

An excluded service may include cosmetic surgery, such as a facelift or teeth whitening.

Other services may be excluded from any health plan, so you want to check ahead of your appointments.

When your health insurance plan starts, you may have to pay the negotiated rate for the cost of care until you reach a certain amount. This amount is called a deductible, and it works just like your auto insurance deductible. Once you reach this amount, Blue Cross NC starts paying a percentage of the cost of your care.

Coinsurance is the percentage we pay for a covered service after the deductible has been met, and then you pay the difference in the amount owed. Some plans require you to pay a set dollar amount for each doctor’s visit or prescription medicine you buy. This is called a copayment. Your policy may require you to first meet your deductible.

Let’s say your coinsurance is 80/20 and you have already hit your deductible. If your total bill is $1,000, Blue Cross NC pays $800, and you pay $200. Once you reach your out-of-pocket maximum, Blue Cross NC covers these costs at 100% until your health plan expires.

When you renew your health plan each year, the deductible and out-of-pocket maximum amounts reset.

Most people, no matter how long they have been responsible for their insurance, have a hard time understanding these complicated terms. We hope this makes your health insurance plan a little easier to understand. As you start using your health plan, contact our Customer Service team with any questions.