What does CYD mean?
CYD stands for Calendar Year Deductible.
A deductible is the amount a policyholder is responsible for before the insurance company will start to take over some or all of the costs covered by the plan.
A Calendar Year Deductible re-sets every January 1 at $0.
If you have a health insurance plan with a CYD, it would be unfortunate to get sick at the end of December because you may use up your deductible only to have to meet it again in January.
See the example below:
Imagine you have a PPO health insurance policy with a $1000 deductible and you're feeling sick in early December.
The doctor refers you to a specialist who then sends you to a diagnostic facility for expensive tests. The specialist and the testing services are subject to your deductible, so you have to pay out of your pocket and you have almost satisfied your deductible.
You then go back to the specialist and he tells you that you now need surgery to cure your problem but you can't get the surgery scheduled until January.
The money you spent in December counts toward last year's deductible, but not toward the deductible for the new year. In this case, you would have to spend another $1,000 to meet the deductible a second time for treatment of the same condition you had diagnosed the year before.
Some health insurance policies will allow you to carry over your deductible from the end of the previous year so you can avoid this type of situation.
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