Dave’s Corner: What Is a Deductible, Co-Payment, and Co-Insurance?

It’s important to have someone on the inside of your corner. Today’s episode we’re going to decipher some insurance jargon. This episode can help someone looking for health insurance make a smarter decision when they are shopping. Dave is going to cover the three most commonly used terms today in healthcare that everyone should know: deductible, co-payment, and co-insurance.


Firstly, a deductible is what someone must pay upfront before their health policy is activated. Once the deductible is met, then the insurance company will start paying out. If you have a deductible, you’ll notice that a plan may offer multiple deductibles. Lower deductible plans mean that you have less to pay upfront for the plan to kick in.


The next term to talk about is co-payment. Co-payments are like a cover charge or a flat dollar amount that you are responsible for. It’s an agreement between network providers in the plan.  The agreement states, “I’ll accept this flat dollar amount or this cover charge in exchange for coverage.” For example, if you go to the doctor and you have a copayment on the plan of $20, then you’re responsible for that $20.


Co-insurance means you’re going to pay a little bit, and the carriers are going to pay the rest. So for example, if you know your plan has an 80/20 co-insurance, it means that the carrier will pay 80 percent and you’ll pay 20 percent remainder.

Each plan may have all three of those pieces or may have only two, but it’s important for you to know the definitions. We look forward to seeing you next week.

  • A deductible is an amount you pay for health care services before your health policy begins to pay.
  • A co-pay is a fixed amount you pay for a health care service, usually when you receive the service. The amount can vary by the type of service.
  • Co-insurance is your share of the costs of a health care service. It’s a percentage of the amount we allow to be charged for services. You start paying coinsurance after you’ve paid your plan’s deductible.

Since insurance is often times overwhelmingly confusing, we want to shed light on this industry by answering YOUR questions.  So if you have any questions or concerns, comment below and your question may be the topic of our next video!

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