Ever felt a little lost when trying to understand your health insurance? It’s okay, many of us have! Today, we’re going to clear up one common term that often pops up: coinsurance.
So, what exactly is coinsurance? Think of it like this: after you’ve paid your “deductible” – that initial amount your insurance requires you to pay out of pocket each year – your insurance company starts to share the costs of your medical care. Coinsurance is your percentage share of that bill. For instance, if your plan has 80/20 coinsurance, your insurer pays 80% of the cost, and you’re responsible for the remaining 20%.
It’s different from your deductible, which is what you pay before coinsurance even starts, and it’s also different from a “copayment”, which is a small, fixed amount you might pay for a doctor’s visit. Coinsurance is a percentage and kicks in after your deductible is met, continuing until you reach your out-of-pocket maximum for the year.
Understanding coinsurance helps you better plan for healthcare costs and choose the right insurance plan for you and your family. Knowing your share of the bill means fewer financial surprises down the road. Stay informed, and make smart choices for your health!