Your Health Insurance Deductible Is About to Reset

The year 2021 is just around the corner — with little fond farewell for 2020 — and that means your health insurance provider is about to reset your deductible. And what, exactly, does “reset your deductible” mean? That’s just one of things we’re going to cover in this post.

Suppose you have a health insurance plan with a $3,500 deductible. You have to spend $3,500 out of pocket on medical expenses before your plan would start to help you cover any future medical expenses. If you already paid $3,500 in 2020, your deductible is zero ($0), and your health insurance provider has to pay up whenever you are charged for a medical expense covered by that plan. (Of course, how much of the bill your insurance company is required to pay varies according to the plan you have.)

However, on New Year’s Day 2021, or whenever your health insurance plan is set to renew, your deductible is reset to our arbitrary $3,500 figure, and you have to start from scratch to cover that deductible before your insurance company is required to pay any of your medical costs.

Resetting your deductible also means:

• If you’ve already met your deductible for 2020, and you need any healthcare services or products that your insurance plan covers partially or in full (such as an expensive prescription), you’d be wise to buy it before midnight on Dec. 31.
• You should start thinking about setting aside some money to cover your 2021 deductible, especially if you have a high-deductible health insurance plan combined with a health savings account (HSA).

Pro Tip: Speak with your accountant or financial advisor to learn how to use your HSA to maximize your tax savings. And if you’re unfamiliar with HSAs, read Offset Medical Costs with a Health Savings Account or Flexible Spending Account here on the Restoration Healthcare blog.

Getting to Know Your Health Insurance Plan

Health insurance plans are generally structured as a cost-sharing model, meaning you and your health insurance company share the costs of your medical care. These cost-sharing models typically take one of the following forms:

• You pay 100 percent until meeting your deductible. Your health insurance company doesn’t pay anything (except sometimes the cost of preventive care, such as an annual checkup) until you’ve met your annual deductible. You pay 100 percent of your medical bills until you’ve met your deductible. After meeting the deductible, you pay only copayments (copays) and co-insurance until you’ve met your out-of-pocket maximum, and then your insurance covers any expenses above and beyond that amount.
• You pay copays and co-insurance until meeting your deductible. With these plans, the health insurance company covers a portion of the cost of some non-preventive healthcare services before you meet your deductible. For example, you may have a $50 copay for doctor visits, and your insurance company pays the rest. For services that require co-insurance, you pay 100 percent until meeting your deductible, then (after you meet your deductible) you pay only the co-insurance amount. With some plans, the copays and co-insurance amounts are applied to the deductible, and in others, they’re not.

Whether you’re in the process of choosing a health insurance plan or you already have one, you should know what kind of plan you have and the following details about the plan, which you can obtain from the insurance company:

• Which doctors and services are covered. (Does the plan limit your choice of doctors or charge more to use providers outside their “preferred network”?)
• Whether copays are required, for what, and how they’re calculated.
• Which services the insurance company pays in full at no cost to you even before you’ve met your deductible.
• Which medications are covered and how the cost of those medications is shared between you and the insurance company.
• The amount of the deductible.
• When the deductible is scheduled to reset.
• What expenses are charged against the deductible.
• Whether your plan is HSA eligible.

More About Your Deductible Reset

Your deductible is reset automatically by the health insurance plan’s policy administrator, and it almost always occurs on Jan. 1 or the date on which your health insurance plan is set to renew. Keeping your deductible in mind is important as you begin to receive bills from healthcare providers, because this enables you to:

• Plan more effectively, so you have money to cover any medical expenses that your health insurance plan does not cover.
• Slash your medical expenses by having your insurance company cover the lion’s share. For example, suppose you’ve already met your deductible for the year in October or November and you discover you need knee replacement surgery. It would make sense to schedule that surgery for November or December rather than waiting until next year, so the insurance company will have to pay a larger portion of the bill (or the entire bill, depending on your plan).

How We Can Help

Navigating the complexities of health insurance plans and deductibles as we enter the new year can become overwhelming, especially when you’re dealing with existing health issues. We can help in the following ways:

• We can contact your health insurance plan provider to find out for you the coverage available for the treatments you need, so you are blindsided by unexpected expenses.
• We obtain pre-approval for any treatments or procedures that require it.
• If you are already a patient, at the start of your health insurance plan year, we contact your new or existing health insurance plan administrator to verify the status of your insurance. We do this to confirm whether you are still with the same insurance company or have had some major change to your policy. For example, a change from preferred provider organization (PPO) to a health maintenance organization (HMO).
• As we verify insurance, we check whether any exclusion has been added to your plan. An exclusionspecifies any treatments or services that the plan does not If we uncover an exclusion, we notify you via the OnPatient Portal and work with you to explore other treatment options that are covered by insurance.
• Set up extended payment arrangements to spread out the costs and, when possible, make your insurance company responsible for a greater portion of those costs. In this financial climate, we believe providing flexibility on paying deductibles or co-insurance is very important. We can provide up to a six-months financial payment arrangement on any open balance.
• Schedule more of the treatments and procedures you need earlier in the year to use up the deductible as quickly as possible, so you don’t have to worry about medical bills the remainder of the year. Many of our patients know that they will end up spending their deductible with us, so by having their treatment protocol laid out early in the year, they can meet their deductible sooner, which provides peace of mind when it comes to future treatments or services.

Contact Our Billing Team

While our focus is on optimizing health and wellbeing, we understand that paying for the treatments and procedures we recommend is a concern for most of our patients, and we work hard to alleviate this concern as much as possible. If you have any questions about billing or questions about your health insurance plan that we may be able to answer, please contact our billing team:

• Use Collectly where you can initiate a “chat” with one of our billing reps.
• Call our main office at (949) 535-2322 and ask to speak with our in-house Billing Dept.
• Via email using billing at RhealthC dot com.
• Leave a message for us using your account on the OnPatient Portal. Simply write a question to your Restoration Healthcare physician, and his or her Medical Assistant will then coordinate with the billing department.

Your health is priceless, so don’t let the cost of healthcare stand in your way. Contact us to help find out more about your health insurance plan and what it covers — and discover ways to use your insurance to minimize your out-of-pocket costs!