Cost sharing

Cost sharing refers to the share of costs covered by your insurance that you pay out of your own pocket. This term includes deductibles, coinsurance, and copayments, or similar charges, but it doesn't include premiums, balance billing amounts for non-network providers, or the cost of non-covered services. Cost sharing in health insurance refers to the share of costs covered by your insurance that you pay out of your own pocket. This term generally includes deductibles, coinsurance, and copayments.

Overview

In the United States, cost sharing for healthcare services is often part of the healthcare plan. This is typically in the form of a "copayment", "coinsurance", or "deductible". The level of cost sharing is often inversely proportional to the level of coverage provided by the insurance company.

Types of Cost Sharing

Deductibles

A deductible is the amount you pay for healthcare services before your health insurance begins to pay.

Coinsurance

Coinsurance is your share of the costs of a healthcare service. It's usually figured as a percentage of the amount we allow to be charged for services. You start paying coinsurance after you've paid your plan's deductible.

Copayments

A copayment or copay is a fixed amount for a covered service, paid by a patient to the provider of service before receiving the service. It may be defined in an insurance policy and paid by an insured person each time a medical service is accessed.

Impact of Cost Sharing

Cost sharing can impact both the insurer and the insured. For the insurer, cost sharing is a way to reduce the risk of overutilization of healthcare services. For the insured, cost sharing can be a financial burden, but it can also make them more aware of the cost of healthcare services and make them more likely to only use services that are necessary.

See Also

• Health insurance
• Healthcare in the United States
• Healthcare reform in the United States