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The Basics: What Do You Pay For and When?
You and Alcoa share in the cost of your benefits. Alcoa pays the majority of the costs which adds up to more than $7,000 per employee/year. This is an important part of your total compensation. Your portion of the costs are paid in three ways. Your payroll contribution, annual deductable, and coinsurance. Your out-of-pocket maximum
Payroll Contribution
Each pay, you share the cost of your plan through a payroll deduction. This amount was on your enrollment worksheet when you enrolled for your benefits. These contributions are paid on a pre-tax basis which reduces your taxable income, resulting in less tax being taken from your pay.
Annual Deductible
When you use medical care during the year, you pay for all of your medical services until you reach your annual deductible. After you've reached this amount, Alcoa begins to share the cost of your medical care through coinsurance.
Coinsurance
After you've spent enough on medical services to reach your annual deductible, you and Alcoa share the cost of your medical expenses through coinsurance, which is a percentage of the cost. Alcoa pays the majority of the cost.
Annual Out-of-Pocket Maximum
Some people think of their annual out-of-pocket maximum as the "worst-case scenario"- basically, the most they will ever pay for medical care in one year. Keep in mind, most employees never come close to reaching this maximum.
After you have enough out-of-pocket expenses to reach your annual out-of-pocket maximum, Alcoa pays 100% of your eligible medical costs for the remainder of the year. Your out-of-pocket maximum includes the money you've spent toward reaching your annual deductible plus your share of coinsurance costs.
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