Coinsurance

Coinsurance is the percentage of a covered health care service that you pay after you’ve met your deductible. It's an essential part of how your health insurance plan shares costs with you.

How Coinsurance Works

Let’s break down an example:

Imagine your health insurance plan’s allowed amount for an office visit is $100, and your coinsurance is 20%. Here’s how your costs would look depending on whether you’ve paid your deductible:

• If you’ve met your deductible: You will pay 20% of the $100, which equals $20. Your insurance company covers the remaining 80%.

• If you haven’t met your deductible: You are responsible for paying the full $100.

Coinsurance Example with High Medical Costs

Coinsurance becomes more significant when dealing with higher medical expenses. Let’s say you have a serious condition requiring extensive treatment, and the allowable costs for your care total $12,000. Here’s a sample breakdown based on the following plan details:

• Deductible: $3,000

• Coinsurance: 20%

• Out-of-pocket maximum: $6,850

Here’s how the costs would be divided:

1. First, you’ll pay your full deductible of $3,000.

2. After your deductible is met, you’ll be responsible for paying 20% of the remaining $9,000. That equals $1,800.

In total, your out-of-pocket costs will be $4,800, which includes your $3,000 deductible and $1,800 coinsurance. If your total costs for the year reach your out-of-pocket maximum of $6,850, you won’t have to pay anything more for covered services for the rest of the plan year. Your insurance company will cover 100% of all additional covered costs.

Coinsurance and Premiums

In general, plans with lower monthly premiums tend to have higher coinsurance rates, while plans with higher monthly premiums typically offer lower coinsurance. Choosing the right balance between premium costs and coinsurance is important based on how much healthcare you anticipate needing throughout the year.

At Aura Insure, we can help you find the right balance between premiums, deductibles, and coinsurance to fit your needs. Our team of experts can guide you through the different health insurance plans and help you understand how your coverage works so that you can make the best decision for your healthcare needs.