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What is a deductible?


A deductible is the amount you must pay each calendar year before your medical insurance plan begins paying benefits. Many, though not all, health insurance plans have deductibles. Deductibles can be as low as $250 and as high as $5,000. For example, if your plan has a $500 deductible, which means you will need to pay for $500 worth of medical care before your health plan will begin paying benefits according to the terms of your contract.

Even though you are paying the $500, you should still have your health provider bill your insurance company. Otherwise, your insurance company will have no way of knowing when you have met your deductible and when to begin paying benefits. While each plan is different in most cases, things such as office visits, lab tests, and prescriptions count toward the deductible. Things that might not count toward most deductibles include over-the-counter medications and cosmetic and other elective procedures that are not considered covered items under your insurance plan.



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Jennifer Mathes, Ph.D.