Know what you may owe


  • Your cost share is the amount you’ll pay
  • Going out-of-network may increase your cost share

A simple guide to cost sharing

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Understanding cost share: Unlocking affordable health care and a happy wallet

Imagine if you had to pay the full cost for all your health care. Chances are, you couldn’t. That’s why there’s health insurance. 

But health insurance typically doesn’t pay everything. You still have to pay something. Knowing how much can be useful. An important piece of the payment puzzle is called cost sharing.

What is cost sharing? In a nutshell, it refers to the share of costs for services covered by your health insurance that you must pay out of your own pocket. It’s literally sharing medical costs with your insurance company. You pay some costs out-of-pocket. And your insurance company also pays some costs. 

Although cost sharing may seem complicated, it’s not rocket science. This formula helps explain it.

Cost share includes: copay, deductible, coinsurance

Infographic highlighting the health care insurance costs an insurance provider pays and the costs an employee pays

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Who pays health insurance costs? Insurance provider costs include provider charges and costs covered by the health plan. Employee costs include out-of-network costs and co-payment

To help you make sense of this formula, here are some basic definitions.

Copay: The set amount you pay each time you get a health care service.

For example: Let’s say your health plan has a copayment of $30 for laboratory services. If the lab charges $110 for blood work, your copay will be $30. If the lab charges $700 for blood work, your copay will still be $30.

Deductible: The amount you might have to pay out of pocket each year for allowed amounts of covered medical care before your health plan begins to pay. Keep in mind that money paid to an out-of-network provider isn't usually credited toward your deductible.

For example: If your health plan has a $1,000 deductible for care, you pay the first $1,000 for services that are covered. Your deductible has then been met.

Coinsurance: Your share of the cost of a health care service, calculated as a percentage of the allowed amount for the service.

For example: Let’s say your health plan has coinsurance of 20% for urgent care services. If your plan allows $1,000 for your visit, your coinsurance will be $200 (20% of $1,000).

When you might have $0 cost sharing

Your cost share doesn’t include the premium you pay each month, which is probably taken out of your salary. Also, your cost share could be higher if you use a provider who is not in your plan’s network. (More on this later.) 

Here’s an example of $0 cost sharing: You pay $0 for preventive care because your insurance plan pays it at 100%.

How going out-of-network may affect your cost share

If you use an out-of-network provider, your copay and coinsurance may both be higher. What’s more, the amount you pay may not go toward your deductible. The result? Your cost share will probably be higher.

Chart comparing higher health care costs from out-of-network providers and lower costs from in-network providers

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How going out-of-network may affect your cost share.

When you select an in-network provider you’re more likely to save money.

A health plan design might pay all the costs for services from a network provider. But it might only cover half the costs for services from a provider outside the network.

Besides paying a higher cost share, you may also have to pay the difference between the amount your provider charged and the amount your insurance allows. This is called balance billing. It's separate from your copay, deductible, and coinsurance payments. A balance bill is the difference between the provider's charge and the allowed amount. The allowed amount is the maximum dollar amount your plan allows for services covered.

For example, let's say you see a doctor who's not in your network and they charge $2,000 for a certain procedure.
Here’s a break down of the cost share:

  • You’ve met your plan deductible for the year. 
  • Your health plan allows $750 for the procedure but you are responsible for paying 20% of the $750 allowed. So, you pay $150, and your plan pays $600. 
  • $750 didn’t cover the provider’s bill for $2,000. So, after receiving $750, the provider sends you a balance bill for $1,250, which is the balance of the original bill from the provider. 

Sometimes, out-of-network providers charge a lot more than other providers for the same service. That's where Naviguard® can help. Naviguard is a service included in some UnitedHealthcare plans at no additional cost. It aims to lower the amount you may owe for medical care from out-of-network providers. Our experts will carefully review your case and determine if the provider’s charges are reasonable.

If you were billed too much, our negotiators may contact the provider on your behalf to try to negotiate a lower amount. Naviguard does all the negotiating and will keep you updated throughout the process.

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