Deductibles and cost-sharing expenses
A deductible is the amount you pay for health care services each year before your health insurance pays its portion of the cost of covered services. Our study finds that in 2020, the average annual deductible for single, individual coverage is $4,364 and $8,439 for family coverage. Keep in mind, individual health insurance plans’ deductibles vary considerably: some may be as low as $0.
Copayments and coinsurance are cost-sharing payments you make each time you get a medical service after reaching your annual deductible.
A copayment is a fixed amount that you pay for covered health care services. For example, assume your plan has a $30 copayment and your doctor’s visit is $150. If you:
Haven’t met your deductible, you’ll pay $150 at the time of your visit
Have met your deductible, you’ll pay your $30 copayment
Coinsurance is a percentage of covered health care service that you pay for covered services after you have met your deductible. Assume your plan has a 20% coinsurance and your doctor’s visit is $150. If you:
Haven’t met your deductible, you’ll pay $150 for the visit
Have met your deductible, you’ll pay 20% of $150 (which is $30)
Maximum out-of-pocket limits
The maximum out-of-pocket limit is a financial safety net. This dollar amount is the most you have to spend for covered services in a year. After you reach this amount, the insurance company pays 100% for covered services for the rest of the benefit year. Your deductible, copayments and coinsurance payments count toward the annual maximum out-of-pocket limit.
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