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Your Quick & Easy Guide to Health Insurance Terminology

Here at Optimized Health Plans, we are determined to take out the confusion around health insurance. Our quick and easy guide will teach you exactly what you need to know to make your insurance meet your needs as perfectly and painlessly as possible.


This is the amount you are expected to pay each month for health insurance. Your Premium is determined in part by your household size and your estimated income. 

If you qualify, you can also receive an Advanced Premium Tax Credit, which will be applied towards your Premium — all you have to do is pay the remainder.


This is the base amount you will pay before your insurance provider covers any medical costs. Deductibles can either be a dollar amount or a percentage of your policy.


This is the pay ratio that you agreed to alongside your medical provider (such as 70/30, or 80/20). Keep in mind that this ratio will apply only before you reach your Max out of Pocket.

Max Out of Pocket

This is the maximum amount of money you will pay for any medical costs. Once you reach this limit, your insurance will then cover 100% of future costs until the end of the year.


This is the fixed dollar you pay for a certain medical service each time you visit an office or clinic.

Tax Forms

At the end of the year, you will receive a 1095-A form from your health insurance provider. This form will tell you how much you paid in subsidies for the year. The information provided in this form will then be used to fill out another form, the 8962.

The 8962 is used to reconcile Advance Premium Tax Credit. In essence, if you made a certain dollar amount, you will either be above or below the tax credit amount specified. You must then reconcile that difference, either paying or being refunded. These specified amounts are determined by the previous year.

What are the next steps?

We’ve covered a few of the basics of health insurance. At Optimized Health Plans, our goal is to guide you through the process in a way you’ll be able to understand in the first conversation and then help you make an educated purchase with the right plan for you and your family.

Our in-house Marketplace is a vital tool for anyone, especially those who are self-employed. We also know that self-employment is as freeing as it is variable, so be sure to keep in contact with us whenever life throws changes your way, pay increase or decrease, if you move, start another business, you or your spouse lose your job, you get married or divorced, or you have a new baby.

Our helpful staff will work with you to figure out how to curate your insurance plan to meet all of your needs. 
Give us a call at (385) 317-4119, get a quote, or visit our offices in Spanish Fork today.