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  • Aetna
  • Alliance Health and Life
  • Align Network
  • Auto
  • Blue Care Network
  • Blue Cross
  • Blue Cross MI Child
  • Cofinity
  • HAP HMO & PPO & Senior Plus
  • Healthplus
  • Humana Advantage
  • McLaren
  • Medicare
  • Medicare Plus Blue
  • Railroad Medicare
  • Theramatrix
  • Tricare
  • Unitedhealthcare/Optum Health
  • Workers' Compensation

Difference between Coinsurance, Deductible, Out-of-Pocket Maximum, Copay, and Premium

Health Insurance Terminology:
Health insurance, as any other type of insurance has its own terminology. Without which, an effective health insurance comparison cannot be done. Below, we explain some of the most important terminology so you can be better educated. All these terms are costs associated with having health insurance. Most of them are only paid when health insurance is used, the one only that must be paid regardless, is premium.

Premium:
Premium is the amount of money that you pay to have insurance. Premiums are typically paid in monthly or quarterly installments. In general, plans with a lower premium will have a higher deductible and coinsurance, and vise versa.

Copay:
A copay is a fee that you pay for each doctors visit. Copayment amounts may vary depending on your insurance plan, and whether you are in or Out of network.

Health Insurance Deductible:
Deductible is the amount you pay for eligible medical expenses in a calendar year. After the deductible has been met, you pay nothing or you share the cost with the insurance company up to the Out-of-Pocket Maximum. Each time a Copay is made, this will typically apply towards the deductible.

Coinsurance:
Coinsurance is a health care cost sharing between you and your insurance company. The cost share ranges from 80/20 to 50/50. The insurance compay is the first set of numbers, meaning that if you have an 80/20 plan, the insurance company pays 80% of annual medical expenses, and you pay 20%. The sharing stops when you reach your Out-of-Pocket maximum, after which the insurer pays 100%.

Out-of-Pocket Maximum:
Out-of-Pocket Maximum, also referred to as Out-of-Pocket limit is the maximum amount of money that you pay per calendar year for medical expenses. This may or may not include your deductible, depending on your insurance plan. This can also vary depending on "In Network" or "Out of Network" services.

How Deductible, Coinsurance, Copay, and Out-of-Pocket Maximum all tie together:
The more you are willing to pay out of pocket, the lower your premium will be. The higher your deductible and Copay rates are, the more affordable your insurance will be.