Insurance Terminology

Here are some terms you will need to know in order to understand and compare insurance plans:

Deductible – The amount that must be paid by the insured before the insurance company begins to reimburse for covered expenses. For example, if you purchase a plan with a $500 deductible and incur $1500 of expenses, the insurance company will begin to reimburse for expenses after you have paid the initial $500 “deductible”.

Co-Insurance or Co-pay – The percentage or amount of eligible expenses that the insured pays after the deductible. For example: If an insurance company offers an 80/20 co-pay, it means that the insurance company pays 80% of the charges and the insured pays 20%. Many plans have a maximum out-of-pocket (co-pay) amount, which means that after you have paid a certain amount of expenses, the insurance company will reimburse for expenses at 100% up to the plan limit.

Exclusions – The expenses that the insurance company/ plan will not pay. Possible examples include expenses resulting from illegal drug use, or pre-existing conditions. Read coverage carefully to understand the exclusions in each plan.

Pre-existing conditions – Medical conditions (including pregnancy), medication, consultation, or treatment which existed or which were performed prior to the effective date of the insurance coverage. These are often not covered in non-Yale plans.

Premium – The amount you pay to purchase your medical insurance plan. Premiums may be paid full in advance or monthly depending on the policy.