Pub. 1 2019 Issue 3

TheMost Important Number in Your Health Insurance Plan E ach year the Internal Revenue Service (IRS) announces dollar limits for group plans and high deductible health plans (HDHPs) as well as health savings accounts (HSAs) for each calendar year. The “out-of-pocket maximum” is one of these numbers. Healthcare companies can get caught up in using very particular language, some of it required by government regulations, which can make things confusing for the members they’re trying to help. Put simply, an out-of-pocket maximum is a predetermined, limited amount of money that an individual must pay before an insurance company will pay 100 percent of an individual’s health care expenses for the remainder of the year. This makes the “out-of- pocket maximum” the most important number in your health insurance plan! One issue many people find con- fusing is the difference between a plan’s deductible and out-of-pocket limit, both of which represent points at which the insurance company pays for all or some of your care. Why are the amounts often different, and how does each affect health care costs? Think of the out-of-pocket maximum as your deductible + coinsurance + copayments up to a total dollar amount. If you can grasp the above four terms, you can comprehend the basics of your policy. So, the out-of- pocket maximum includes the amount you pay to see your primary care doctor or specialist, the amount you pay for hospital related services, the percentage you pay after you have paid your deductible, what you pay for your prescriptions, and excludes premiums. It truly represents your total financial exposure in your health insurance plan. In the unfortunate event an injury or disease results in increased healthcare expenses, out-of-pocket maximums help to keep your total costs manageable. Think of it as “asset protection.” If your plan covers more than one person, you may have a family out-of- pocket maximum in addition to an individual out-of-pocket maximum. That means when the deductible, coinsurance and copays for one person reaches the individual maximum, your plan then pays 100 percent of the allowed amount for that person. When what you’ve paid toward individual maximums adds up to your family out-of-pocket max, your plan will pay 100 percent of the allowed amount for health care services for everyone on the plan. Most health plans have online tools and apps that keep everything orga- nized for you. Here is an overview of the adjusted dollar limits for 2019. Self-only coverage refers to plans for one individual, while family coverage refers to plans for two or more individuals. In any year, plans can have out-of-pocket limits below the established thresh- olds. It's important to understand that your plan's maximum out-of-pocket can be lower than these amounts ... it just can't be higher. For example, the health plans that NHADA offers to our members is below the estab- lished thresholds, making the NHADA plans richer than many plans that are purchased directly through health insurance carriers. Why does the out-of-pocket max- imum increase each year? Essen- tially, it's a method of keeping premiums in check, and keeping up with medical inflation. Maximum out-of-pocket limits for 2019 group plans are as follows: • $7,900 for self-only coverage ($7,350 in 2018) • $15,800 for family coverage ($14,700 in 2018) Out-of-pocket maximums for 2019 for High Deductible Health Plans (HDHP)/ Health Savings Accounts (HSA) are: • $6,750 for self-only coverage (versus $6,650 in 2018) • $13,500 for family coverage (versus $13,300 in 2018) LAURIE CHURCHILL ACCOUNT PRODUCER / FIELD REPRESENTATIVE, WELLNESS PROGRAMS N E W H A M P S H I R E 17