Understanding Health Insurance: Deductibles, Copays, and Coinsurance

Health Insurance Costs Explained

Between deductibles, copays, coinsurance, and out-of-pocket maximums, understanding what you actually pay can feel impossible. Here are the five key terms.

Premium

Your monthly payment to maintain coverage regardless of usage. Higher premiums usually mean lower costs when you use healthcare.

Deductible

The amount you pay before insurance starts paying. Most plans cover preventive care before you meet your deductible.

Copay

A fixed dollar amount per visit, like $25 for primary care or $50 for a specialist.

Coinsurance

Your percentage share after meeting the deductible. Common splits are 80/20 or 70/30.

Out-of-Pocket Maximum

The most you will pay in a plan year. After reaching this, insurance pays 100%.