In-Network
Health insurance companies contract with provider groups, doctors, care specialists, hospitals, and other health care providers in a network to receive a special rate for their services. They are then considered “in-network.”
Out-of-Network
Health insurance companies that do not contract with provider groups, doctors, care specialists, hospitals, and other health care providers in a network to receive a special rate for their services are considered “out-of-network.” There is no discount applied to the service you received from that provider. Health insurance companies try to discourage members from going to out-of-network by charging them higher co-pays, co-insurance, and deductibles.
For example, in the table below you can see both scenarios for a visit to the same provider with the same bill from the doctor. But because no discount is applied and the co-insurance is higher the plan ends up paying less and you end up paying more.
In-Network | Out-of-Network | |
|---|---|---|
Doctor’s Bill | $500 | $500 |
Discount Applied | 20% | 0% |
Amount to Pay | $400 | $500 |
Co-Insurance | 20% | 50% |
Plan Pays | $320 | $250 |
You Pay | $80 | $250 |