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Health insurance terminology in the U.S. is confusing. The confusion is even worse for international students—especially those who aren’t native English speakers – because the meaning and function of the terms is a new concept. That’s why we’ve narrowed it down to the top 6 insurance terms international students absolutely have to know.
Understanding these 6 basic concepts will help international students compare healthcare plans and find one that works best for them.
A deductible is the amount paid out-of-pocket by students before the insurance provider will pay any expenses. After paying the deductible amount, or “meeting the deductible,” students will only be responsible for a portion of their healthcare bills, or may be covered at 100%, depending on the plan and benefits.
Pro Tip! Deductibles can range from $0 to $10,000+ depending on the plan, so international students should be sure to know that number. Deductibles can also be applied per year or per illness or accident. This is a very important factor, because if the deductible is per illness or accident, a student will have to pay it every time you use the plan! Also, paying the deductible is not always required; some benefits may be available without requiring the deductible to be paid first.
Luna, an international student, chose Lewerglobal’s Standard F-1 International Student plan, which features a $100 deductible. That means Luna will use $100 of her own money to pay for healthcare expenses before her insurance starts to help her cover healthcare costs.
A copayment, or a copay, is a flat fee that students pay for a healthcare service each time they use it. Different copay amounts will usually apply to office visits, specialist visits, urgent care, emergency room visits, and prescription medications.
Luna doesn’t feel good and goes to a pharmacy. Her plan includes a $10 copay for medication, so Luna only pays $10 for her medicine, even though the total cost is more than that.
Coinsurance is the portion of the bill students pay after meeting their deductible and/or copay. Coinsurance is typically shown as two percentages: one for in-network providers and one for out-of-network providers. For instance, a plan might have 100% / 80% coinsurance. This means if international students go to an in-network provider, insurance will cover 100% of the bill for covered services, after any applicable deductible or copay. However, if they go to an out-of-network provider, insurance will only cover 80% of the bill, after deductible/copay. Students would be responsible for the remaining 20% of the cost up to their out-of-pocket maximum (more on out-of-pocket maximum below!).
Pro Tip! It is important to research and visit a provider that is in-network. By doing so, you will guarantee you get the best cost available on your plan.
Luna has already paid her $100 deductible, and she needs to go to the doctor again. Her plan has 100% coinsurance in-network. That means if Luna chooses to see a doctor who is on the preferred provider list (an in-network provider), her insurance will cover 100% of her bill for covered services.
A plan maximum is the largest amount an insurance company will pay for a covered injury or illness within a given time period, typically a year. Some plans have a per injury or illness maximum, which is different from an annual maximum.
Luna gets injured and has to seek medical care. She goes to an in-network hospital and pays her copay. She has already met her $100 deductible, so her insurance will cover 100% of the rest of her bill, up to a per-injury maximum of $300,000. That means the insurance company will pay all the way up to $300,000 before Luna would have to start paying again.
A premium is the cost students pay to obtain insurance coverage. This amount is usually shown on a daily, monthly, or annual basis. Some plans allow month-to-month payments, while others require the full amount up front to activate coverage.
Luna is comparing Lewer’s F-1 student plans. Depending on the benefits she wants and how much she is comfortable paying per month, she can choose between different plan options that will fit her budget.
An out-of-pocket maximum is the maximum amount of money students will have to pay for covered medical expenses in a given time period.
Luna’s total medical bills for the year add up to $50,000, but her insurance plan’s out-of-pocket maximum is $6,000. Luna will only have to pay $6,000 out of her own pocket for the year. Her insurance will cover the rest.
These 6 insurance terms are the basics international students need to know before comparing health insurance plans. Understanding these key terms will help students choose the best plan for their situation and budget.