Help! I don’t understand my bill or insurance! (Part 1)

Don’t understand your medical bill or your insurance? You are not alone! Even doctors like me have a hard time making sense of it. Actually, according to an article in The Washington Post (August 8, 2013), a healthcare economist asked 200 people with health coverage to define four insurance terms. Only 14 percent answered four questions about the four most basic insurance features and got the right answer.

I get lots of questions and, yes, complaints about billing issues. It’s not a mystery why: nothing about the process is easy. I thought it might help us all to have a “health insurance 101”  to learn why it has been so complicated and how you can best navigate the process. I am even going to break this into two parts so that you can easily digest the information.

Let’s start with the big picture:

Your relationship with your insurance

Whether you get your insurance through an employer or buy it yourself, your health insurance policy is a contract between you and your health insurance company. It is an agreement that your health insurer will pay for covered medical care as long as your premium is paid.

Your plan

Each insurer offers different plans. You or your employer select the one that’s best for you. Some plans are more expensive than others. If you pay a lot for the insurance coverage up front, you pay less when you go to see the doctor (your out-of-pocket cost). If you pay less for coverage, you will be responsible for a higher deductible, meaning you will pay for more at a doctor’s visit.

Your doctors – in-network and out-of-network

In-network: Doctors or providers contract with insurance plans and that makes them part of the insurer’s network to offer specific rates to the insurer’s members.

Out-of-network: If you see a doctor or provider who was not contracted with your insurer, then your insurer will pay a smaller percentage of your care — or there may be no out-of-network benefits to see an out-of-network provider.

Insurance terms to know:

Consider the following your cheat sheet:

Co-pay: The part of your medical bill you must pay each time you visit the doctor. This a pre-set fee determined by your health insurance policy.

Deductible: The cost you must pay for medical treatment before your health insurance company starts to pay for services and treatments. For example, your deductible might be $500 per individual or $1,500 per family. You will still get charged the in-network rate if you see an in-network physician, but after that discount is applied you’re on your own until the amount you have paid reaches your deductible.

You may have one deductible for everything, but may also have separate deductibles for in-network care, out of network care and prescription medicines. The deductible resets itself at the beginning of your plan year, which may or may not coincide with the calendar year.


Co-insurance: The part of your medical bill, in addition to a co-pay, that you must pay after you reach your deductible. Co-insurance is usually a percentage of the total medical bill — for example, a your insurance pays 80% of the bill and you pay 20%.

Out-of-Pocket-Limit: The maximum amount that you pay per year (usually not including copays, deductibles and some other fees). Basically, once you meet your deductible, you pay your co-insurance until you have paid a certain amount of money. After that, your insurance company pays at 100%. However, some plans do the out-of-pocket limit differently and it’s important for you to know, so please check with your insurance as to what your specific plan is on all fronts.

HAS/FSA: If your employer offers this benefit, a Health Savings Account or Flexible Spending Account allows you (and/or your employer) to contribute money tax-free to be used to pay your medical bills. Sometimes these can be through the insurance company and the money can be sent directly to the doctor. Other times, they give you a special card (i.e. Benny card) to use at the doctor’s office or pharmacy.

To save money, some employers will pick a high-deductible plan and then contribute a certain amount to your HAS every month to assist you in getting the health care you need.


In part two, we’ll delve deeper into your medical bill, looking at it line by line and how your costs are determined for doctor’s visits. In the meantime, I hope you take a closer look at your current health insurance plan and ask your insurer any questions that you may have afterwards.

If you have questions or want to make an appointment to talk with our sleep specialist, please call us at 703-729-3420 or contact us online at You can also leave us questions and comments on our Facebook page or tweet to us.