What Is Coinsurance?

Coinsurance is the portion of the cost of healthcare services that you are responsible for once you've paid your deductible. It is usually a percentage of the total cost of the service.

How Coinsurance Works

Most health insurance plans have some sort of cost-sharing. Cost-sharing means that the insurer will pay a portion of your medical expenses, but you will also have to pay a portion. It can take the form of a deductible, co-pay or coinsurance.

In most health insurance policies, you must pay coinsurance after you have met your deductible. Coinsurance is usually a percentage of the cost of care, usually 20 percent.¹ In comparison, co-pays are usually set dollar amounts that depend on the type of health care service you get and where you get care.

Most health insurance plans people get through work – 68 percent – have coinsurance, according to a Kaiser Family Foundation study.¹

Most people who get insurance via Medicare or Medicaid are subject to coinsurance, but it can vary greatly with the type of service. For example, for those with Medicare, once you have met your deductible coinsurance for the first sixty days of a hospital stay is $0, but for doctor visits, coinsurance is 20% of the cost of the visit.²

Calculating Your Coinsurance Expenses

To better plan for health care expenses, you should know whether your policy has coinsurance, and if so, how much it will be. You also need to know whether you have satisfied your deductible.

These steps can help:

• Know the coinsurance percentage that applies to the services you receive. This is usually located in the Summary of Benefits from your health insurance provider. Not all services will have the same coinsurance; it varies depending on the type of service.
• Find an estimate for the cost of the care you plan to receive on your insurer's website.
• If you have already received care, you will receive an Explanation of Benefits (EOB) that will detail the cost.
  • If you have paid all of your deductible, then multiply the cost of the healthcare by the percentage of your coinsurance. For example, if the charge for a service is $100, and your coinsurance for this service is 20%, you will owe $20.
• If you have paid only part of your deductible, you will be responsible for the balance and then an additional percentage of the balance of the bill.
  • For example, if your deductible is $500 and you have paid $450 for previous services, and your bill for new services is $100, you must first pay $50 to satisfy your deductible. You and your insurer will still have to pay the remaining $50. If your coinsurance is 20 percent, your insurer will pay $40, and you will pay an additional $10. Your total out-of-pocket would be $60.

The Preventive Services Exemption

Because most insurers cover preventive care - routine care that includes screenings, check-ups, and patient counseling to prevent illnesses, disease, or other health problems - at 100 percent, you will not need to pay coinsurance for these services. Some examples of preventive care are:

• Alcohol misuse screening and counseling
• Blood pressure screening
• Cholesterol screening for adults of certain ages or at higher risk
• Colorectal cancer screening for adults 50 to 75
• Depression screening
• Diabetes (Type 2) screening for adults 40 to 70 years who are overweight or obese
• HIV screening for those ages 15 to 65, and other ages at increased risk
• Immunizations/vaccines
• Lung cancer screening
• Obesity screening and counseling
• Statin preventive medication for adults 40 to 75 at high risk
• Tobacco use screening for all adults and cessation interventions for tobacco users

Coinsurance and the Out-of-Pocket Maximum

Most health insurance policies have out-of-pocket maximums – the most you will spend per year on covered health care expenses, not including your premiums (the cost for your policy). Once you reach this amount, you will no longer be responsible for coinsurance until everything resets at the end of your policy year. There are uncommon exceptions, such as older policies that were in place before this rule came into effect. Check your policy for details on your out-of-pocket maximum.

Managing Healthcare Costs with the CareCredit Credit Care

If you are looking for an option to help manage your medical bills, consider healthcare financing with the CareCredit credit card. The CareCredit card can help you pay for the care you want and need and make payments easy to manage.* Apply today and use our Acceptance Locator to find a provider near you that accepts CareCredit. Continue your wellness journey by downloading the CareCredit Mobile App to manage your account, find a provider on the go, and easily access the Well U hub for more great articles, podcasts, and videos.

Our Expert Reviewer

Patty Caballero and her team of consultants together have more than 35 years of health insurance knowledge working for some of the biggest health insurance companies in the US. She has knowledge in building brands and strategic initiatives to help consumers better understand their health benefits.