What is a deductible in regards to health insurance?

by Daniel C. Lewis

What is a health insurance deductible?

A health insurance deductible is the amount of money you must pay towards medical expenses before your insurance kicks in.  Usually this doctor's visits and prescriptions but not always.  For example, with a $1,000 deductible, you're responsible for paying the first $1,000 of covered services yourself.  Once you meet your deductible, your insurance will help you pay or additional medical expenses.

Here is an example of how a deductible works:      

Let's say you have an $1,000 deductible and you are in a car accident and end up I the emergency room with a broken arm.  One month later you receive the bill.

The total cost of the visit is $1,500:  $1,000 for the emergency room visit + $500 for the cast

If you pay $1,000 toward your emergency room visit, you've met your deductible.  Now your insurance company pays all or a portion of the $500 towards your cast, along with any future healthcare expenses for the rest of your plan's coverage year.

Deductibles, premiums, copayments, and coinsurance, are important for you to consider when choosing a health insurance plan.  Make sure to choose plan and deductible that best suits you and your family.

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