Covered doesn’t always mean free: Here’s what “covered benefit” really means | hioscar Blog | Oscar
Covered doesn’t always mean free: Here’s what “covered benefit” really means
Does "covered" always mean free? Learn the truth about health insurance coverage, including how deductibles work.
How Insurance WorksOscar Member Resources
5 min read
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Imagine this: James has been dealing with persistent, nagging knee pain for months after a long run and finally sees his primary doctor. When his doctor suggests he see a physical therapist, James immediately checks his insurer’s online portal to see if the specialist visit is covered. When he sees the word “covered” next to the service, he feels a sense of relief, assuming he won’t have to pay anything out of pocket. However, like many of us, James receives a surprise bill and realizes that being covered doesn’t always mean a service is free.
We’ve all been there. But in the insurance world, “covered” simply means your insurance plan has a deal with your doctor to help pay for a service. It doesn’t always mean the service is free. For some services to be covered, prior authorization is required to ensure the service is medically necessary.
Why “covered” isn’t always $0
When a healthcare service is covered, it means your health plan helps pay for it. It doesn't automatically mean you will not have out-of-pocket costs. Here are the three main ways you and your health insurance plan share costs for covered services:
Deductible: The dollar amount you have to pay out-of-pocket for covered services before your health insurance plan begins paying for your care.
Copay: A fixed flat fee you pay for covered appointments, services, medical equipment, or prescriptions. Copays vary for the type of service received. For example, a copay for a doctor visit may be higher than a copay for a common generic prescription.
Coinsurance: Coinsurance is your share of the cost of a covered service, usually expressed as a percentage. Coinsurance is calculated as a percentage of the allowed service amount. So, if a service costs $100 and your coinsurance is 20%, you would owe $20, and your insurance company would pay the remaining $80.
The exception: Preventive care
There is one big exception: Preventive care. Most health plans are required to cover preventive care at no cost to you, as long as you see a doctor in your network. Preventive care includes services like your annual physical, certain screenings, and vaccines.
Preventive care is proactive, focused on maintaining your health and catching potential issues before symptoms appear. On the flip side, diagnostic care is reactive, used to investigate, monitor, or treat an existing symptom or condition. Because of this difference, preventive care is typically covered at no cost to you, while diagnostic care often requires cost-sharing like a copay or deductible.
FAQ: Navigating your benefits
How do I know if a service is covered?
You can check your benefits and coverage in your online account or app. You can also call the number on the back of your insurance card and speak to a representative who can check your plan details and let you know whether a service is covered, and how much you might owe based on factors like deductibles, copays and coinsurance specific to your plan.
What if I see an out-of-network doctor?
If you go out of network, a service that is normally “covered” might cost you a lot more, or not be covered at all. Always try to stay in-network to save money.
Why did I get a bill for a free physical?
Sometimes, if you bring up a new health issue during a preventive visit, the doctor might code part of the visit as diagnostic, which could trigger a copay or deductible. For example, if you schedule an annual physical but then ask your doctor to examine a new, persistent rash, the doctor may address the rash as a separate, diagnostic service for which you may receive a bill depending on your deductible, copays and coinsurance.
If a benefit is covered, does that mean there is no Prior Authorization required?
No. A covered benefit may still require prior authorization. Prior authorization is a review process used by your health plan to ensure that certain high-cost or specialized services, like some surgeries, implants, or high-cost medications, are medically necessary before you receive them. If a service requires prior authorization and you get the care without it, the service may not be covered, and you could be responsible for the full cost. You should always check your plan details to see if a service requires prior authorization before you schedule the care. If you are an Oscar member, you can view the full list of services that require prior authorization here (opens in new tab). To check whether a prescription drug requires prior authorization, log in to your account (opens in new tab) on the member website or mobile app and search by drug name to see coverage details and pricing.
We’re here to help
Understanding insurance shouldn’t feel like learning a second language. If you’re ever unsure about what a bill means or whether a treatment is covered, check your plan details first. You can log in to your Oscar account (opens in new tab) on the member website or mobile app to review your plan details and understand what to expect. Or, you can reach out to your Care Team. We’re here to help you navigate the system and get the care you need — without the surprises.
Oscar Medical coverage is underwritten by Oscar Insurance Company and its affiliates. Administrative Services for all plans provided by Oscar Management Corporation. All insurance policies and group benefit plans contain exclusions and limitations. For availability, costs, and complete details of coverage, contact Oscar at 855-672-2788.
This information is intended for informational purposes only. It is not intended to be a substitute for professional medical advice, diagnosis or treatment. Always seek the advice of your physician or other qualified health care provider with any questions you may have regarding a medical condition or treatment and before undertaking a new health care regimen, nor should you disregard professional medical advice or delay medical treatment because of the information being provided here.
