Deductibles, copays and coinsurance are a few factors that determine how a health insurance policy works. More specifically, these facets determine how costs are divided by the insurance company and the insurer.
Let’s define how deductibles, copays, and coinsurance work in a traditional health insurance policy:
A deductible is a certain dollar amount the policyholder must pay before health insurance benefits kick in.1 Deductibles can range from $250 to $7,500+ depending on the plan you choose.2
A copay is a set dollar amount that the policyholder agrees to pay for various kinds of care and treatment—like doctor visits, preventative care, and prescriptions.3
Coinsurance is the percentage a policyholder pays for health services after the deductible has been met.4
Sometimes, how deductibles, copays, and coinsurance are structured can leave policyholders with thousands of dollars expected to be paid out-of-pocket. Aflac doesn’t offer primary health insurance plans, but we do provide supplemental coverage to work with your primary plan to help pay outstanding costs, like deductibles, copays and coinsurance.
Don’t wait until it’s too late. Help cover yourself and your family with affordable coverage from Aflac.
There are a handful of differences between copays and deductibles. As we learned earlier, a deductible is a pre-determined value that must be met before any policy benefits become available. Deductibles can fall somewhere in the hundreds or thousands of dollars.
On the other hand, copays start at $10 and apply to your health services. These fees remain static regardless of if you’ve met the deductible or not. These copays can help make office visits, preventative care and other healthcare more affordable compared to paying completely out-of-pocket without any health insurance.5
The difference between copays and coinsurance is how the policyholder agrees to pay for a portion of services. As we discussed earlier, copays relate to the specific dollar amount, while coinsurance relates to the decided payment percentage.
Copay structures are determined by the type of healthcare you receive and apply, even if you haven’t met your deductible.6 For example, the copay may be lower for preventative care than for an urgent care visit. On the other hand, coinsurance can be broader and only applies after you’ve met the deductible.7
The cost breakdown for coinsurance could look like having you pay 20% of services while your insurance company pays the other 80%. This payment structure only applies until you meet your maximum out-of-pocket limit.8 If you reach this value, your health insurance company will pay for any remaining treatments within the coverage year. It’s important not to confuse your deductible with the maximum out-of-pocket limit.
The difference between deductibles and coinsurance is related to when payments are due and how they accumulate. Coinsurance benefits only kick in after the deductible has been paid in full.9 Until then, policyholders can still get financial assistance through copays. Deductibles are paid down steadily as soon as the plan is active.
Now that you understand how deductibles, copays, and coinsurance work, you may understand where there are potential areas for greater coverage in your existing health insurance plan. Luckily, Aflac offers a variety of specific supplemental insurance plans to help offset those costs.
We offer supplemental insurance plans for vision, hospital, cancer, accident, short-term disability, and critical illness care. If you know the specific healthcare category you need better support in, we recommend chatting with an agent today to see how Aflac can help make your care more affordable. If you’re unsure what kind of supplemental coverage you need, we recommend learning more about our options.
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1 3-8 Investopedia - Coinsurance vs Copays/ What’s the Difference. Updated May 3, 2022. https://www.investopedia.com/articles/insurance/120816/coinsurance-vs-copay-why-you-need-know-difference.asp. Accessed Jun 21, 2022.
2 Forbes - What Is a Health Insurance Deductible. Updated May 17, 2022. https://www.forbes.com/advisor/health-insurance/what-is-a-health-insurance-deductible/. Accessed Jun 22, 2022.
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