Limits on Covered Benefits of HSA-Qualified Health Insurance
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Limits on Covered Benefits of HSA-Qualified Health Insurance
Limits on benefits
Just like traditional policies, HSA-qualified policies may put limits on covered benefits, such as the number of visits, limit payments to "usual, customary, and reasonable" (UCR) amounts, use formularies or preferred lists for prescription drugs, and require prior authorization before services are provided. These limitations should be described in your insurance policy. Be sure to read your policy certificate and determine whether the coverage is what you and your family need based on your family’s history of medical care use.
Things To Know
- Just like traditional policies, HSA-qualified policies may put limits on covered benefits.
- The deductible on an HSA-qualified plan must apply to all covered benefits, including the cost of prescription drugs.
All consumers should learn as much as possible about the scope of coverage under their insurance plan. In particular, you should not assume that once the plan’s deductible or out-of-pocket limit is met, all remaining medical expenses will be paid by the plan. Everyone should understand what their plan will and will not cover once their deductible and out-of-pocket limits are met. As is the case with any type of health insurance, benefits are subject to the definitions, limitations, and exclusions described in the policy and are payable only if determined by the plan that they are medically necessary. However, such decisions may be subject to plan reconsideration and external appeal.
Buyer’s Guide
As with any insurance contract, the amount of covered benefits affects your premium. Pay close attention to the details of what benefits are covered by the plan and under what circumstances, what is not covered (or "excluded") and under what circumstances, and the types of medical providers from which covered benefits are available. Make sure you understand what expenses count towards satisfying your policy deductible and out-of-pocket limits.
If you are chronically ill and take several prescription medications, you may satisfy your HSA-qualified policy deductible with your drug expenses alone. Although this means that you pay the total cost of your prescriptions while your deductible is in effect, you will pay only the negotiated cost of your medicines, not the full retail price. This is one of the benefits of your HSA-qualified policy. Another benefit is that since these prescription expenses count towards meeting your deductible, you may hit your deductible and out-of-pocket limits faster than under a traditional policy, which means your policy could pay 100% of covered benefits sooner than a traditional policy.
Also pay attention to whether your doctor(s) and any other medical providers you are used to using (including hospitals, pharmacies, etc.) are in your plan’s provider network or you may have higher out-of-pocket expenses.