Coinsurance Percentage

What Does Coinsurance Percentage Mean?

Coinsurance percentage refers to the portion of a service cost that is shared between the insured and the insurer. It is expressed as a percentage, with the insurer typically covering the larger share and the insured covering the smaller share. This arrangement applies only after the insured has fully paid the deductible.

Insuranceopedia Explains Coinsurance Percentage

In insurance, the deductible must be fully paid before the insured can access their benefits. If the insured becomes ill and visits a hospital without having met the deductible, they must cover all medical expenses out of pocket.

Once the deductible is paid, the insurer begins to provide coverage. Payments for services are then shared between the insured and the insurer, based on the coinsurance percentage. The higher the percentage paid by the insurer, the lower the percentage the insured is responsible for.

For example, Clara receives a bill of $1,000 for medical treatment. With a coinsurance percentage of 80/20 and the deductible fully paid, Clara would pay $200, while the insurer would cover the remaining $800.