I think this belongs in health insurance, but here is the difference.
Copay is a set dollar amount you pay for smaller services such as doctor visits and tests, etc.
Co-insurance is the percentage you pay after meeting your deductible for more expensive services such as hospitalizations and surgery.
for example if you have a 80/20 plan you pay 20% after deductible and the insurance company pays 80% after you meet the deductible. _________________ Thinking about becoming a health insurance agent or just getting started out as one?
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Both co-pay and co-insurance are devised to prevent the possibilities health insurance scams from the patient's side. Health insurance plans pay for the medical expenses, but that is rarely 100%. The health insurance providers require the applicant to pay a certain share of the entire medical cost in the form of copay and coinsurance. And the amount of copay/coinsurance gets decided at the time of applying for the policy and plays a role in determining the premium rate. _________________ Register Now to have your Insurance queries solved.
Right, both copay and coinsurance are associated with health plans.
Co-pay- when the policy paper describes that the policy holder is required to pay a fixed amount everytime towards the treatment (doctors' visits, prescription drugs) before the policy benefits kicks in.
Coinsurance-the coinsurance is same as copay. However, the only difference is that it is described as a percentage of the total cost of the medical care.
Coinsurance has certain demerits, as it is described as a percentage of the total cost, it is tend to vary with the amount of the care received, whereas, the amount of co-pay will remain fixed throughout, and thus is more predictable in terms of the out-of-the-pocket pay.
