What is a copay in health insurance?


WRITTEN BY: Craig Sturgill

UPDATED: DECEMBER 30, 2022 | 3 MIN READ

When you purchase medical insurance, you may be confused by some terms. Coinsurance, copays, and deductibles are all varying payments. But what do they all mean? Not all plans use copays in expense costs. Let’s dive deeper into medical services and the role of health insurance copays.

When do I have a copay?

A copayment is a flat fee you pay each time you have a doctor’s visit. It’s a common form of cost-sharing for health insurance plans. For example, if you have to see your doctor due to pain or an illness, you may need to pay when you arrive. The amount you pay for the visit upfront is the copay.

Your copay amount should be printed directly on your insurance card. It covers a portion of the cost of your doctor’s visit or medication. Under the Affordable Care Act, some services like annual physicals, cancer screenings, or well-women visits don’t have copays.

Are there always copays?

Not every healthcare plan includes copays. Some programs can use health Insurance copays with coinsurance or a deductible. There are some health insurance plans with no out-of-pocket costs. Usually, annual checkups or preventative care are covered services with your health care.

What does a copay cover?

Copays cover the cost of various doctor visits. Medical services requiring a copay are different depending on your insurance company. Standard healthcare services with copays include:

  • Primary care office visit
  • Specialist referral
  • Physical, speech, or occupational therapy
  • Prescription drugs
  • Emergency room visits
  • Ambulance rides
  • Mental health services

The copay amount can be different depending on the total healthcare costs. They may be higher for a specialist than a visit with your primary care doctor. Out-of-network providers usually have higher copays than in-network.

How to know if there’s a copay

Many insurance companies or healthcare providers ask for your copay at the time of service. The copay amount is usually right on your health insurance card. You could even see different amounts depending on the service.

Some health insurance companies have no copays. It’s probably a more expensive plan, with higher monthly premiums, and could include higher deductibles. Check with your insurance company regarding out-of-pocket expenses.

Copay vs. deductible

Your copayment is a fixed fee when you receive covered care or pick up a prescription. A deductible is different than a copay. Deductibles are the amount you pay out-of-pocket toward medical expenses before your health insurance company pays. Your health insurance copay can’t go toward the deductible in most cases.

Copay vs. coinsurance

The difference between coinsurance and a copay is trickier. Both are cost-sharing for using services to your doctor’s office, preventative care, or medication. The difference is a copay is a set amount. Coinsurance is a percentage of costs after you’ve met your deductible.

What plans require a copay?

Copays are more standard with managed care plans like HMOs. Insurance companies have contracts with healthcare providers to pay fixed fees for services. It’s possible to find other programs, like PPOs, including copayments. Some are in addition to annual deductibles or coinsurance.

Copay benefits

Plans with cost-sharing offer benefits for the insurance provider and members. The insurance policy lets companies keep costs down and helps you know what you pay upfront for services. Prices can vary depending on your health plan, so compare premiums and copay costs.

FAQs

How does a copay work?

Your health insurance plan determines the fixed fee you pay for services. The amount can vary depending on the type of service. You pay the copay at the time of service.

What does a $25 copay mean?

Having a $25 copay means each time you visit your primary care physician, you’re expected to pay $25.

What is a copay example?

For example, if you hurt your wrist and see your doctor, you’re responsible for paying when you arrive. You must pay upon arrival if you go into your doctor’s office to refill your child’s medication. Those are examples of copays.

Which is better, copay or deductible?

A deductible is an amount you must pay toward medical expenses before your health insurance pays. Usually, your copay doesn’t go toward a deductible, so it’s better to know your cost upfront with a copay.

Is it better to have a copay or not?

Plans with copays tend to be less expensive than the coinsurance you would pay. However, depending on your medical needs, a copay isn’t necessarily better.

What does a copay have to do with insurance?

Insurance companies use copays to share health care costs. It’s a fixed amount you pay toward a covered health service.

What is the difference between a copay and coinsurance?

A copay is a set amount you pay before your service. Coinsurance is a percentage of costs you pay after you’ve met your deductible.

What is a copayment?

A copayment is the same thing as a copay. You pay for a covered health service at a fixed amount.

What is the purpose of a copay?

Copays are a common form of cost-sharing under many health insurance plans. It’s the portion of costs covered by you out of pocket.

Get Help Understanding Copays

Splitting the cost of medical services between the insurance company and you help keep your monthly medical bills in check. Copays are a part of many health insurance plans and can cease once you’ve reached the out-of-pocket maximum.

Are you looking for health insurance with lower copays and premiums? Fill out our online rate form and get rates for the most competitive insurance carriers in your area!