4 Terms I Wish I Understood When I Signed up for Health Insurance

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• I chose a health insurance plan with the lowest monthly premium.
• I would have chosen a different plan if I knew what the terms like deductible and co-insurance meant.
• Next year, I’ll weigh the pros and cons of having a higher monthly payment vs. a higher deductible.

I was 30 years old when I started my first full-time, corporate job (which was here at Insider). Before that, I worked as a freelancer and dependent on California state’s health insurance, Medi-Cal, for two years. Back in New York, when I was working in the fashion industry, I worked at a startup that only offered one affordable health insurance option.

Working full-time at Insider is the first time I’ve had to choose between different tiers of health insurance plans. While I did my best to research my options, I still felt unprepared to make the decision. There are four terms I wish I’d known before choosing my current plan.

1. Out-of-network provider

Thanks to Medi-Cal, I was able to find a physical therapist just a 10-minute drive from my house to help me prepare for and recover from top surgery, and I didn’t have a copay. My new health insurance through work is accepted nationwide, but I noticed more providers on the east coast were in-network than providers on the west coast, where I live.

It turns out that my physical therapist didn’t take my shiny new corporate-job insurance, which makes them an out-of-service provider. I had to pay $125 per session out of pocket for my appointments.

2. Deductible

After learning that my physical therapist was out of network, I called my health insurance company to ask what my options are moving forward. If I wanted to continue seeing my physical therapist, I would need to keep paying for services out of pocket until I met my deductible, the amount that I’m responsible for paying until my insurance starts chipping in.

In order to keep seeing the same physical therapist, I had to pay $125 per session until I met my $1,000 deductible. Thankfully, I had an emergency savings fund specifically for my top surgery care needs to cover that cost.

3. Out-of-network co-insurance

After paying for eight $125 sessions, I’d met my $1,000 deductible. For appointments past those eight sessions, I got a break from paying full-price because I’m now only responsible for paying for out-of-network co-insurance. This means I’m responsible for 40% of the cost of the appointment, and insurance will cover the remaining 60%.

4. Out-of-pocket limit

The out-of-pocket limit on a health insurance plan is the amount that I have to pay before insurance covers 100% of services. There’s a different out-of-pocket limit for out-of-network services and in-network services with my plan.

My out-of-pocket limit for services outside of my network is $3,500, and it includes any deductibles, co-pays, or co-insurance that I’ve paid for my physical therapy. Once the amount I’ve paid for full-price appointments and co-insurance reaches my out-of-pocket limit, insurance will pay for 100% of my out-of-network costs.

Truth be told, I chose the health insurance plan I have because it was offered the lowest monthly premium. Had I understood what these terms meant before choosing them, I would have weighed the pros and cons of having a larger monthly bill to stay on Medi-Cal while I was recovering from my surgery, or getting on my work’s health insurance for a lower price .

While my premiums might have been lower on my work’s health insurance plan, staying on Medi-Cal might have prevented me from paying over $3,000 in physical therapy bills in the span of four months — sometimes I needed to go to my physical therapist multiple times a week — out of pocket while I was recovering from surgery.

Now that I know better, I look forward to choosing my health insurance plan this year.