Coinsurance concept?

Coinsurance concept?

• A. The insured pays a certain amount of the claim while the insurer pays the rest; a common split is 80%/20%.
• B. A fixed annual fee.
• C. All costs after deductible are paid by the insurer.
• D. A prepayment for services.

Answer: (A)

Coinsurance is the cost-sharing arrangement where, after any deductible is met, the insured pays a percentage of covered expenses and the insurer pays the rest. A common example is an 80%/20% split, with the insurer covering 80% and the patient responsible for 20% of the allowed amount, continuing until the out-of-pocket maximum is reached. This reflects the idea of sharing costs, rather than paying a fixed amount or having the insurer pay everything after a deductible. The other concepts describe different ideas: a fixed annual fee resembles a premium or deductible in some contexts but not how coinsurance works; all costs after deductible paid by the insurer would eliminate the patient’s ongoing cost-sharing, which isn’t coinsurance; a prepayment for services points to prepaid plans rather than the percentage-based sharing of expenses.

Coinsurance is the cost-sharing arrangement where, after any deductible is met, the insured pays a percentage of covered expenses and the insurer pays the rest. A common example is an 80%/20% split, with the insurer covering 80% and the patient responsible for 20% of the allowed amount, continuing until the out-of-pocket maximum is reached. This reflects the idea of sharing costs, rather than paying a fixed amount or having the insurer pay everything after a deductible.

The other concepts describe different ideas: a fixed annual fee resembles a premium or deductible in some contexts but not how coinsurance works; all costs after deductible paid by the insurer would eliminate the patient’s ongoing cost-sharing, which isn’t coinsurance; a prepayment for services points to prepaid plans rather than the percentage-based sharing of expenses.