Navigating health insurance can be complex, especially when it comes to understanding cost-sharing mechanisms. This article breaks down three key components: deductibles, copayments, and coinsurance.
Deductibles
A deductible is the amount you pay for covered health care services before your insurance plan starts to pay. For example, with a $2,000 deductible, you pay the first $2,000 of covered services yourself.
Key Points:
Deductibles reset annually
Some plans have separate deductibles for specific services
Preventive services often covered before meeting deductible
Copayments
A copayment (or copay) is a fixed amount you pay for a covered health care service, usually when you receive the service. For example, $20 for a doctor visit or $10 for a prescription.
Key Points:
Copays can vary for different services
You may have copays even after meeting your deductible
Copays generally don’t count toward your deductible
Coinsurance
Coinsurance is your share of the costs of a covered health care service, calculated as a percentage. For instance, if your plan’s allowed amount for an office visit is $100 and you’ve met your deductible, your 20% coinsurance payment would be $20.
Key Points:
Applies after you’ve met your deductible
Your plan pays the rest of the allowed amount
Can vary depending on the service
Understanding these components helps you better manage your healthcare costs and choose the right plan for your needs.
