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Health Insurance Deductibles Don’t Always Add Up

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Your insurance coverage might not be covering as much as it should. Most health insurance policies have annual deductibles—amounts that the policyholder must pay out-of-pocket before the insurance company starts paying its share of the bills.

But insurance companies don’t always calculate policyholders’ out-of-pocket expenses accurately, which can leave policyholders paying more than their share. Such mistakes usually go unnoticed because few people fully understand their insurance and fewer still track their expenses closely enough to notice that they’ve been overcharged.

Example: An editor at Bottom Line/Personal went over his medical expenses and discovered that his insurance provider had miscalculated his deductible payments for two consecutive years, costing him at least $300 each year.

What to do: If you have significant insurance claims in a year, dig out your policy and check the size of your deductible. Then go back through your relevant bills and insurance statements, and add up the charges that have been applied to your deductible. If you don’t have your statements, try calling the insurer—or if you have workplace coverage, call someone in the human resources department.

If it appears that you’ve paid more than your share, call the insurer and ask for an explanation. There might be a legitimate reason—perhaps some of those expenses were not covered by your policy.

If you have been overcharged, the insurance company likely will agree to refund the difference—insurers tend not to argue much when presented with clear-cut deductible calculation errors.

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Source: William M. Shernoff, JD, founding partner of Shernoff Bidart Echeverria Bentley LLP, a law firm based in Claremont, California, specializing in insurance bad-faith litigation. He also is founder of the Consumers Law Project at University of Wisconsin, Madison. Shernoff.com Date: October 1, 2013 Publication: Bottom Line Personal
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