Insurance Copay And Deductible

Posted : admin On 1/1/2022

It is important to understand how your health care plan operates, but far too often the tricky benefit jargon of “deductible, coinsurance, copay, and out-of-pocket max” get in the way. These hard to understand health care vocabulary terms are explained below to help make understanding your health care plan much simpler!


Deductible – the amount of out-of-pocket expenses you pay for covered health care services before the insurance plan begins to pay.

  • Deductibles and coinsurance are clauses that are mostly implemented together under one single insurance plan. But, a few insurance plans also implement copayment and deductible clauses simultaneously. If your health insurance plan does the same, here is what it will mean for you – You will have to pay a fixed amount towards your treatment plans.
  • A copay after deductible is a flat fee you pay for medical service as part of a cost-sharing relationship in which you and your health insurance provider must pay for your medical expenses. Deductibles, coinsurance, and copays are all examples of cost sharing.
Insurance Copay And Deductible
HSA-Eligible PlanAll covered services require you to meet your deductible first and then services will be covered through coinsurance.
PPO PlanSome covered services require you to meet the deductible first, while other covered services are paid with a copay.
Helpful Hint!The health plan comparison chart shows deductible amounts for Tier 1, Tier 2 and Tier 3, but you should think of your deductible as one sum of the money you have paid for your services.
ExampleWith a $1500 Tier 1 deductible on the HSA-Eligible Plan with single coverage, you pay the first $1500 of covered services yourself. If you have met this, you would pay an additional $100 towards your services and then would have met the Tier 2 deductible of $2,500.
Insurance Copay And Deductible

Copays and deductibles are both features of most insurance plans. A deductible is an amount that must be paid for covered healthcare services before insurance begins paying. Copays are typically. Depending on your health plan, you may have a deductible and copays. A deductible is the amount you pay for most eligible medical services or medications before your health plan begins to share in the cost of covered services. If your plan includes copays, you pay the copay flat fee at the time of service (at the pharmacy or doctor's office, for example).


Coinsurance – the percentage of cost of a covered health care service you pay once you have met your deductible.

HSA-Eligible and PPO PlansFor services covered by “coinsurance after deductible” the amount you pay in co-insurance continues to count towards meeting your next Tier deductible.
Coinsurance %Most Tier 1 services are covered at “90% coinsurance after deductible,” while Tier 2 services are “75% after deductible and Tier 3 are “60% after deductible.”
ExampleIf you are on either plan and have hit your Tier 1 deductible and visit a Tier 1 urgent care provider, the plan covers that service at “90% coinsurance after deductible.” This means you will pay 10% of the cost of the visit and your insurance will cover the remaining 90%. The 10% you pay will count towards your deductible.

Copay – a fixed dollar amount you must pay to a provider at the time services are received.

PPO PlanOnly the PPO Plan offers a copay option for specific covered services. Your copay does not count towards your deductible.
Copay AmountsCopay amounts vary based on the plan design. The health plan comparison chart is the best resource to understand what your copay is for a covered service within any of the tiers.
ExampleIf you are on the PPO plan and you see a Tier 1 provider for a standard sick visit, then your copay at the time of the visit will be $20. If you seek a Tier 1 provider for physical therapy, then your copay will be $35.

Out-of-Pocket Max – the maximum amount you pay each calendar year to receive covered services after you meet your deductible. Once you meet your out-of-pocket maximum, the Plan pays 100% of covered services you receive. In network and out-of-network services are subject to separate out-of-pocket maximums.


Difference Between Coinsurance And Deductible

HSA-Eligible and PPO PlansYour out-of-pocket max is the summation of everything you have paid for your medical services received; this includes deductible, coinsurance and copay.
Helpful Hint!Out-of-pocket max’s are determined by coverage level (single vs plan with dependents) and salary. On the health plan comparison chart you will see multiple rows with Out-of-Pocket Max figures, so be sure to look in the row that pertains to your situation.

Copay Vs Out Of Pocket

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Medical Insurance Copay And Deductible

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