Deductibles vs. Coinsurance: What’s the Difference?

Health insurance can feel like a foreign language. Two of the most confusing terms patients run into are deductible and coinsurance. They both affect how much you pay for care—but in different ways. Let’s break them down in simple terms.

What Is a Deductible?

Your deductible is the amount of money you must pay out of pocket for covered medical services before your insurance starts to help pay.

Think of it like this:

The deductible is the “entry fee” to your insurance benefits.

Example:

Your deductible is $1,500
You get a medical bill for $300

You pay the full $300, and your deductible balance becomes $1,200. Your insurance does not contribute yet because you haven’t met your deductible.

Once you’ve paid a total of $1,500 in medical costs during the year, your deductible is considered met.

Important note: Preventive services (like annual checkups or certain screenings) are often covered without requiring you to meet your deductible—but this depends on your plan.

What Is Coinsurance?

Coinsurance is the percentage of costs you share with your insurance company after your deductible is met.

Think of it like this:

Coinsurance is how you and your insurance “split the bill.”

Example:

Your plan has 20% coinsurance
A covered service costs $1,000
Your deductible has already been met

You pay 20% ($200), and your insurance pays 80% ($800).

How Deductibles and Coinsurance Work Together

Most plans work in this order:

You pay your deductible first
After the deductible is met, coinsurance applies
This continues until you reach your out-of-pocket maximum (the most you’ll pay in a year)

Simple timeline:

Early in the year → You mostly pay out of pocket (deductible)
Later in the year → You share costs (coinsurance)
After out-of-pocket max → Insurance pays 100% of covered services

Quick Comparison

Deductible

A fixed dollar amount
Paid before insurance helps
Resets each year

Coinsurance

A percentage of the cost
Applies after deductible is met
Shared between you and insurance

Why This Matters for Patients

Understanding deductibles and coinsurance can help you:

Estimate medical costs ahead of time
Avoid surprise bills
Plan care throughout the year
Ask better questions about your coverage

If you’re unsure where you stand, check your insurance summary or contact your insurance provider or healthcare office—they can help explain your specific plan.

Final Tip

No two insurance plans are exactly the same. Always review your plan details, especially before scheduling tests, procedures, or hospital visits.

Understanding these basics puts you in control of your healthcare costs.

Call us today at 954-942-6868 or visit our site at DrLapco.com for more information.