Cars

First what is the official definition of coinsurance

Coinsurance

Once you have met your deductible you pay coinsurance for additional medical care It is a percentage of the billed charge For example your insurance company might pay 80 and then you
First what is the official definition of coinsurance

Coinsurance

Once you have met your deductible you pay coinsurance for additional medical care It is a percentage of the billed charge For example your insurance company might pay 80 and then you would pay 20 It is similar to a copay but is a percentage instead of a dollar amount

Now lets dig a little deeper With California health insurance it is common to speak of their plan as an 8020 plan or a 7030 plan They are essentially referring to the coinsurance part of it With the 8020 example the health carrier is picking up 80 of the charges and you are picking up the remaining 20 If there is any kind of deductible you must pay that first at 100 until met

Lets take an example and see how California health insurance plans essentially break down into three main stages

Stage 1 The deductible YOU PAY 100

Lets say you have a 500 deductible Except for services that are separate from the deductible usually office visits and prescriptionssee COPAYS you will pay the discounted charges at 100 until you meet your deductible You can find more information on deductibles

Stage 2 The coinsurance YOU SHARE A PERCENTAGE

Once the deductible is met you then start sharing the cost with the carrier Lets say our plan is 7030 and the charge is 1000 You pay the first 500 deductible and then you pay 30 of the remaining 500or 150 Of the first 1000 charge you would pay 650 out of it If you have another 1000 charge in that same calendar year you would pay 30 of the 1000 or 300 since your deductible was already met When do you stop paying the 30

Stage 3 The Max Out of Pocket THE CARRIER PAYS 100

Once you have met your Max out of Pocket sometimes called the Copay Maximum the carrier will then pay 100 of covered benefits innetwork For our plan example lets say we have a 500 deductible 7030 coinsurance and 5000 max out of pocket If we get a 50000 bill in a calendar year you pay the first 500 then 30 until you reached another 5000 out of pocket For that 50K you would pay 5500 and the carrier would pay 45500 Coinsurance is nice but the real reason to have health insurance is the max out of pocket

Coinsurance usually applies to services outside of the office visit and prescriptions You will typically see the same coinsurance percentage for hospital lab surgery emergency sometimes has separate additional copay and physician services

Its important to stay in network for PPO plans Lets say you have 7030 plan and you see a doctor out of the PPO network on a nonemergency basis for 1000 of services and your deductible is already met youre in Stage 2 Two things will probably happen The health insurance plan will probably have a separate percentage for out of networklets say 5050 instead of 7030 Also the carrier will apply this lesser percentage to what they would pay an innetwork provider For example with the 1000 charge perhaps the contracted PPO rate is 600 discount is usually 3060 The carrier would then pay 50 of the 600 or 300 of the total 1000 You pay 700 Compare this with the 30 of 600 you would pay for an innetwork provider 700 versus 180 out of your pocket Use innetwork providers