What is an out-of-pocket expense?

An out-of-pocket expense is a type of expense that is not covered by health insurance, and must be paid by the patient. In Washington, all health insurance plans must cover the cost of medically necessary services, such as doctor visits, lab tests, emergency services, and prescription drugs. However, there are many services that health insurance may not cover, and these costs must be paid out of pocket by the patient. Common out-of-pocket expenses include co-pays, which are a fixed fee that patients must pay at the time of their doctor visit or during checkout at the pharmacy, as well as deductibles, which are an annual fee set by the insurance company that must be paid by the patient before they are eligible to receive benefits. Other out-of-pocket expenses may include services such as chiropractic care, acupuncture, optometry, and cosmetic procedures, which may not be covered by health insurance plans. In addition, many health insurance plans have maximum out-of-pocket expenses, which is the most patients must pay out of pocket for their health care in a given year. This maximum out-of-pocket limit helps protect patients from financial hardship if they have significant health care costs. In Washington, it is important for patients to read their health insurance plans carefully to understand what services are covered, what out-of-pocket expenses they may be responsible for, and how their maximum out-of-pocket expenses are determined. Understanding these costs can help patients budget for their health care expenses and make sure they are prepared for any out-of-pocket costs.

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