First the good news, if you've recently landed a nice job full of many perks and benefits there is a good possibility that you've also inherited a health insurance policy or plan. Unfortunately, now the bad news, you have no idea or clue what any of the terminology scattered throughout your health insurance policy means. In fact, the more you read the cloudier it gets until you're so baffled that you start to even wonder what exactly your health insurance is covering. Whatever you do, dont be embarrassed or upset because this situation is actually quite common among many first time health insurance policy recipients or holders. Fortunately, once you know the meaning of the language used in your health insurance plan you will be able to decipher it quickly and easily. This article intends to help you with the tasks of health insurance interpretation.

Naturally, there are many different terms used throughout most all insurance policies and plans with health insurance being no different. Perhaps the most important one is what is known as a deductible. Basically a deductible is the amount that an insured individual must pay prior to any of the health insurance benefits kicking in. For instance, if your health insurance policy featured a deductible of $500 and you had a recent medical situation that resulted in a hospital bill of $1200 then you would need to pay $500 first before your health insurance provider would pay for the remaining $700. This example is very rudimentary and crude; nonetheless, it serves it purpose of illustrating the deductible at its most basic level. Typically, the deductible will vary among the many different health insurance underwriting companies so make sure to do some comparison shopping in order to obtain a health care plan that features a deductible you can reasonable afford.

Co-payments is another form of payment that is generally paid for by the consumer before the insurance company will process any claims benefits. This co-insurance (as it is sometimes referred to) can sometimes be paid for routine medical appointments and services without the requirement or restriction of meeting a deductible. This depends on the insurance provider that your health care plan resides with.

Out-of-Pocket is a term that many folks dont usually like to hear because it means exactly what it implies and that is money paid out of the insured consumers own pocket. This would include your deductibles, co-payments and co-insurance. This category doesn't include your premiums or health insurance rates because those are paid no matter what in order to make sure that you have current health insurance coverage. In order to help their insured clients out many companies impose a cap on the maximum out-of-pocket expenses that pay for medical services rendered. You will need to check through your own health insurance policy but this is usually referred to as the annual out of pocket expense.

For additional information on how to decipher your health insurance be on the lookout for part two of this article where we will cover exclusions, pre-existing conditions as well as the waiting and grace periods.