Costs Explained

The highest dollar amount your health insurance plan will pay for covered health care services. This may also be called “eligible expense,” “payment allowance” or “negotiated rate.”

If you use an in-network provider, you pay a portion of the total allowed amount in the form of a co-pay, co-insurance or deductible.

If you use an out-of-network provider that charges more than your plan’s allowed amount, you may have to pay the difference. Additionally, your plan may not pay for out-of-network services. You should check with your insurance company to confirm your benefits if you plan to use an out-of-network provider.

Co-insurance is your share of the costs of a covered health care service. You start to pay co-insurance after you have paid your health plan’s deductible.

This is calculated as a percent of the plan’s allowed amount for the service. You pay a percentage of the cost, and your plan pays the rest. The percentage you pay depends on your health insurance plan and whether you see an in-network provider.

For example, if you have a plan with co-insurance of 20%, you’ll pay 20% of the allowed amount until you reach your out-of-pocket maximum.

A fixed dollar amount, typically paid for at the time you receive a health care service. The amount can vary by the type of service. For example, $25 for a doctor's office visit, $50 to see a specialist and $10 for each prescription filled.

Your deductible is the amount you will pay for non-preventive health care before your health insurance plan starts to pay. For example, if your deductible is $1,000, your plan won't pay for health care services until you have met your $1,000 deductible. After you meet your deductible, you share the cost of health care services with your insurance plan by paying co-insurance.

If you have questions about your deductible, including what health care costs count toward your deductible, or the difference between your individual deductible and family deductible, contact your insurance company.

Your premium is the amount you pay each month to your health insurance company. You must pay your premium each month even if you don’t use health care services that month. If you enrolled in a private health plan through MNsure, you may be receiving premium tax credits which lowers the cost of your premium. 

Your premium amount is based on age, location, tobacco use, individual vs. a family plan, and the coverage level of your health insurance plan (also known as the metal level).

Out-of-pocket costs are your expenses for medical care that aren't reimbursed by your insurance plan. Out-of-pocket costs include deductibles, co-insurance, and co-payments for covered services plus all costs for services that are not covered.

There is a limit on the amount of out-of-pocket costs you have to pay each year for covered health services. Once you reach this amount your health insurance begins to pay 100% of the allowed amount. Keep in mind not all health care costs you pay out of pocket will count toward this limit. For example, the out-of-pocket limit does not include your monthly premium or anything you spend for services your plan doesn't cover. Check your summary of benefits and coverage to see what is included in the out-of-pocket limit for your insurance plan. If you have questions, contact your insurance company.

At the beginning of the plan year, you are in the deductible phase. When you get a prescription or visit a provider because you are sick or injured, you will be responsible for 100% of the full allowed amount, or pay a co-pay depending on your specific plan details and the service.

The co-insurance phase starts once you’ve met your deductible. During this phase, you will pay a percentage of the cost of a covered health care service or prescription, and your plan will pay the rest. (The percentage you pay depends on your health insurance plan and whether you see an in-network provider. See metal levels.) If a co-pay applies to the service, you will pay the co-pay.

This is the final phase within a plan year. If you reach this phase it means you have paid your plan’s out-of-pocket maximum for covered health care services and prescriptions. If you continue to use in-network providers, your health insurance plan will now pay 100% of the costs of covered services until the end of the plan year.