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Health Insurance and Coinsurance

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Jun 24, 2015

 

Health insurance is essential, but it can be confusing. Understanding some of the basic terminology makes it much easier to understand your policy. Here’s what you need to know about coinsurance when it comes to health insurance:

Coinsurance Basics

Coinsurance is the percentage of medical bills that you pay after your deductible. It is often referred to as cost sharing between you and your insurance company. For example in some policies, the insurance company may pay 80 percent of the medical bill and the customer pays the remaining 20 percent. In most cases, your policy will also include an out-of-pocket limit. If your portion of the medical bills exceeds the out-of-pocket limit within the course of the year, the insurer will cover the remaining costs.

Coinsurance is separate from your deductible and insurance premium. The premium is the amount you pay each month or quarter for insurance coverage. The deductible is a set amount of money you pay for eligible medical expenses throughout the year. Coinsurance is also usually separate from your copay, which is the amount you pay upfront for prescriptions and doctor’s visits.

How Does Coinsurance Usually Work?

The amount of coinsurance you pay will depend on your specific insurance policy. For example a customer may pay a $30 copay for annual checkups and prescriptions. For other types of medical treatment the customer may pay for 100% treatment until the yearly deductible is reached. If the customer has coinsurance with an 80/20 agreement, they’ll pay for 20% of medical bills until the out of pocket limit for the year is reached.

For more help understanding health insurance give Bradenton Insurance a call to learn more.



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