BASICS OF INSURANCE

A Contractual Adjustment commonly referrs to an individual whose insurance coverage is provided by an individual or group health plan. Theses plans involve a network of providers contracted by the insurer, wherein the provider agrees to charges that it will write off on behalf of the patient.

Contractual adjustments typically reduce the total amount of services charges, which reduces the total claim amount.

A Deductible is the amount, set by your insurance, that you must pay in health care services before your health insurance begins to pay. For example, if your insurance plan’s deductible is $2,000, you’ll have to pay 100% of that $2,000 yourself.

After you reach your deductible cost, then you share additional health care costs plan by paying Coinsurance.

Coinsurance is the percentage of health care service costs you share with your insurance provider, after you’ve reached your original deductible amount. For example, your insurance provider’s coinsurance rate might be 20%, meaning you pay 20% of the health care service invoices.