Grace Financial Service Associates

What Is Coinsurance?

To understand what Coinsurance is you must first understand what a deductible is. If you are not familiar with what a deductible is, please see
"What is a Deductible?".

Coinsurance is an agreement between the Healthcare Company and the Insured where there is a shared responsibility to pay a medical bill once the insured satisfies their deductible. For example, say you plan has a deductible of $1500. If your healthcare plan also has a 20% coinsurance responsibility, also known as and 80/20 plan, then in a real world instance where you receive a medical bill of $10,000 you will first satisfy your $1500 out-of-pocket deductible, and then you will still be responsible for 20% of the remaining $8,500, or $1700 additional dollars. That $1700 is your 20% coinsurance responsibility and it is on top of the $1500 deductible that you have paid already. Your total bill in this instance would be $3,200.

There are several types of Coinsurances out there. The most common are 0%, 20%, 30%, 40%. If you can afford to have a 0% coinsurance plan, it is highly recommended that you chose this type of plan over a plan that has a 20%, 30%, or 40% coinsurance feature, otherwise you could be subject to high "out-of-pocket maximums". If you are not sure what an "out-of-pocket maximum" is please see "What is and out-of-pocket maximum?"

Want a plan with a lower coinsurance percentage?