111. What is a deductible and copay?

Deductible

This is an amount that is required to be paid by a subscriber before health plan benefits will begin to reimburse for services. It is usually an annual amount of all health care costs that is not covered by your insurance plan.

Some plans have both individual and family maximum deductibles. Typically, this deductible amount is $100., $250. or $500., depending on the plan. Some plans have recently instituted $1000. deductibles.

For example, with a $100. deductible,  you would be responsible for the first $100. in health care charges for the year. After that, the coverage would be split according to your plan formula which may cover a percentage of the fee charged, or limit your costs to a specific out of pocket cost.

Co-payment

The co-payment is the amount you must pay for each service. In managed care plans, you do not need to know the full fee charged by a provider, as you will pay the same "co-pay" regardless of the providers fee.

This standardizes your costs, but also encourages insurance companies to refer you to lesser trained professionals who are paid a lower total fee, since this reduces their cost for the service, while your cost remains the same.

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