Copay vs. Deductible: Know the Difference

What is a Copayment?

A copayment, also called a copay, is a flat fee that you pay for a healthcare service, usually when you receive the service. For example, you may have a $20 copay when you visit your primary care provider or a $50 copay when you visit the emergency room. Copays do not count toward your deductible.

What is a Deductible?

Your deductible is the amount you pay for healthcare services before your insurance plan starts to pay. For example, if your deductible is $1,000, you will need to pay the first $1,000 of your healthcare costs yourself before your insurance plan begins to contribute. After you reach your deductible, you will usually only have to pay a copayment or coinsurance for covered services.

Is it better to have a high deductible or copay?

It depends on your individual healthcare needs and financial situation. Copays are usually smaller amounts of money, so you may have to pay them more often. Deductibles are typically larger amounts of money, but you usually only have to pay them once or twice per year.

If you need a lot of healthcare services, you may benefit from a plan with a low copayment. If you don’t need many healthcare services, you may benefit from a plan with a high deductible.

Do you pay copay before the deductible?

Yes, you typically have to pay copayments even if you haven’t met your deductible yet. Copayments are usually small, flat fees that you pay for a healthcare service. For example, you may have a $20 copay when you visit your primary care provider or a $50 copay when you visit the emergency room. Copays do not count toward your deductible.

Do you have copays after you meet your deductible?

It depends on your insurance plan. Some plans require you to pay a copayment for all services after you meet your deductible. Other plans may not require any copayments after you meet your deductible, or they may only require copayments for certain types of services.

What is the difference between a copay and coinsurance?

A co-payment is a flat fee that you pay for a healthcare service, usually when you receive the service. For example, you may have a $20 copay when you visit your primary care provider or a $50 copay when you visit the emergency room. Copays do not count toward your deductible.

Coinsurance is a percentage of the cost of a healthcare service that you pay after you have met your deductible. For example, if your coinsurance is 20%, you will pay 20% of the cost of covered healthcare service and your insurance plan will pay the other 80%. Coinsurance usually only applies to services provided by doctors and hospitals.

Bottom Line

A co-payment is a flat fee that you pay for a healthcare service, usually when you receive the service. A deductible is an amount you pay for healthcare services before your insurance plan starts to pay. Copays do not count toward your deductible.

If you need many healthcare services, you may benefit from a plan with a low copayment. If you don’t need many healthcare services, you may benefit from a plan with a high deductible.