The Basics of Co-Insurance

When it comes to health insurance, there is a number of options to choose from depending on the needs of an individual. Insurance policies may vary from one plan to the other depending on options, features, and benefits.

In the health insurance marketplace, you will find a wide range of plans that offer different monthly premiums.  One health insurance plan may vary from another depending on a variety of reasons. One of these reasons is the co-insurance costs associated with that plan.

What is co insurance?

For those who are looking into health insurance options, you might have tried looking for “what is co insurance” in your search bar. In its most basic sense, co insurance is the designated percentage of healthcare costs an insured individual needs to pay. Co insurance comes in to play once you have met your plan deductible.

How does co insurance work?

Co insurance is how your healthcare costs are split between you and the insurance company. In terms of dividing expenses, co insurance is typically presented in a percentage, such as 80% and 20%. For a co insurance plan that has an 80/20 coverage, 20% of the medical costs will be covered by the insured while the insurance company covers the remaining 80%. 

Co-insurance works differently based on the metal tier of your health plan. Typically, gold tier plans will have a more favorable co insurance split. Most gold plans will be an 80/20 split, where the insurance company pays 80% of the medical bills, and the individual pays 20%. Silver plans will vary, but we typically see a 70/30 split. Most bronze level plans will be a 50/50 split, or even a 60/40 split.

Co insurance comes into play once you have reached your plan deductible. After the deductible is met, you enter the co-insurance phase of the plan where you split the cost of your healthcare expenses.

Once you have reached your Out of Pocket maximum, your co-insurance ends and the insurance company will pay 100% of the cost of your healthcare going forward.

Selecting the Best Co Insurance

There are  few options to consider when selecting a plan based on the co-insurance split. You should consider the plan deductible, as well as the Max Out of Pocket costs. These two items will help you understand how long you will be in the co-insurance phase of your plan.

If you choose a plan with a $6,000 deductible, and a max out of pocket cap of $7500, then you will only be splitting the cost of your health insurance expenses for that narrow timeframe (or costs). However, if your plan had a $1,500 deductible, and a $7,500 max out of pocket cost, then you’ll be in the co-insurance phase of the plan for a longer time.

Getting Help from a Pro

Co insurance exists as a provision to spread and effectively manage costs of healthcare.  You should consult with your local health insurance advisor to determine which plan will be most beneficial to you. The team at Skyline Insurance Agency are committed to helping you understand your health insurance options, and make the process of selecting and enrolling in a plan as simple as possible.

We are an independent insurance agency based in Utah and provide health insurance solutions to individuals, families, and businesses in Utah and the surrounding States!

Let Skyline Insurance help take the headache out of your health insurance.