Health insurance terms you need to understand

One of the most important decisions you make every year is your choice of health insurance. It is also one of the most confusing. You are confronted with words and concepts you don’t understand or that are not adequately explained. You finally choose a plan, probably the least expensive, and hope it will give you the coverage you need. At Luke Peterson Insurance in Altoona, IA, we understand what an important decision health insurance is and how stressful it can be. We are locally owned and provide a high level of friendly customer service. 


Every insurance company has providers who have a contract to furnish services to members for a predetermined rate. Before deciding on an insurance plan, you should determine if your preferred primary care doctor and any other medical professionals you use are in the network. 


The formulary is the list of covered drugs. They are listed in tiers, and the policy will have set prices for each tier. Before choosing a policy, make sure any medication you take is listed in the formulary and compare the plans’ prices. 


The deductible is the amount that you must pay before the insurance policy kicks in. It can be all services, or some may be exempt from the deductible. Read this part of the policy carefully. 


This is your share of any service. It may be a set amount such as $10 for a visit to the doctor or a percentage of the charge. It is much harder to anticipate the percentage dollar amount. 

Out of the pocket maximum

This is a significant figure. It is the most you will have to pay in any given year for medical expenses. If you have a bad accident or a serious illness with hospitalization, you will really appreciate this limit. 

Contact Luke Peterson Insurance in Altoona, IA to learn more about health insurance options.