What is a health insurance copay?

Your guide to understanding copays.

What you need to know

A copay is one of the ways you may split the cost of health services with your health insurance provider. Copayments are flat fees that you pay for services, such as an appointment or a prescription. Copays are also typically smaller amounts of money, like $20 or $30.

While many copayments go into effect after you've met your deductible, some plans allow you to pay a copayment on certain services before you've met your deductible. This means you may save money on doctor's appointments and prescriptions, especially if you're managing a chronic condition or otherwise plan on going to the doctor frequently.

The money you spend on copays counts as an out-of-pocket expense. All plans have an out-of-pocket limit that limits the amount you spend on health care services in a single year. The maximum out-of-pocket limit for 2019 is $7,900 for individual plans and $15,800 for family plans, but your plan may have a lower limit.

Some plans may have coinsurance in addition to or instead of copayments. Unlike copayments, coinsurance is not a flat fee. Instead, coinsurance is a fixed percentage of the cost that you pay. You may prefer copayments because they allow you to more easily plan out exactly how much you'll pay when you see the doctor. Plans that use copayments may cost more (in terms of the monthly premium) than plans that rely on coinsurance percentages.

Policygenius’ editorial content is not written by an insurance agent. It’s intended for informational purposes and should not be considered legal or financial advice. Consult a professional to learn what financial products are right for you.

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