Co-insurance is that part of any medical services payment that is due from you after any deductions and insurance payments are made. Co-insurance typically comes into play after your annual deductible has been satisfied. Until that time you may be required to pay 100% of any medical services.
Another factor in what you will owe involves out-of-pocket limits. Most insurance coverage has an initial deductible which must be met to be eligible for co-insurance. However, you must continue to pay co-insurance through the rest of the year unless you reach the annual out-of-pocket limit. At that point, you will no longer be required to make co-insurance payments until the next plan year.
Here are examples of how co-insurance works:
Doctor visit — $100 is charged to you for a doctor visit. If you haven’t reached your deductible you will owe $100. Once the deductible is reached a typical co-insurance might be 20%. Therefore you would pay $20 for each visit.
Hospital or medical procedure — Charge is $12,000. If the deductible is $3000 you are responsible for that amount. Co-insurance of 20% is then charged against the $9000 remaining so you are responsible for $1800. Therefore, you would be responsible for a total of $4800. Co-insurance payments will be required for future services until you reach the limit for the plan year.
First Day Films creates videos for employee benefits education. We offer video services for annual open enrollment, doctor choice, options for medical imaging, and much more. We also offer employee benefit advocacy programs to help employees get the most out of their medical insurance plans. For more information, contact us at 833-422-7332.