Understanding Deductibles & Coinsurance

A deductible is the initial amount you cover for healthcare services before your health plan contributes.

For those in good health without pre-existing conditions, selecting a plan with a higher deductible could be beneficial.

Choosing a high-deductible plan offers the following advantages:

  • Decreased frequency of doctor visits
  • Lower monthly premiums and expenses
  • Usually covers preventative services without needing to pay a deductible upfront.

Low deductibles are better suited for scenarios requiring extensive medical care due to illness or injury.

After meeting your deductible, you will be responsible for a percentage of healthcare expenses known as coinsurance.

  • You must pay your entire deductible before you can access coinsurance.
  • Coinsurance represents the insured individual’s portion of covered expenses.
  • Coinsurance functions at a fixed ratio, ensuring that you are consistently billed the same percentage of the total amount every time.

Example: Your health insurance plan sets the office visit amount at $100. With a 20% coinsurance rate, you cover this after meeting your deductible. Until the deductible is met, you are responsible for the full $100.

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