Can you explain the Coinsurance Clause within medical expense plans?
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Asked April 3, 2012
Coinsurance is the amount you have to pay out of pocket each time you see a medical professional. Because you are paying a percentage of the cost yourself, coinsurance is sometimes referred to as percentage participation. Unlike a deductible, coinsurance must be paid with each visit, where a deductible is paid once and then does not have to be paid again for that type of procedure.
In order to keep health insurance quotes down, insurers use coinsurance to reduce the costs to the company. When you go to a doctor, you will be expected to pay the coinsurance, which is generally a small percentage of the total medical costs. Coinsurance is effectively your share of the cost of treatment, and since you are participating in paying for the treatments, you have lower insurance rat3es to pay.
Coinsurance is not negotiable. After carefully research and statistical study, insurance companies developed the idea of coinsurance to offset some of the costs. Without it, your premiums would be quite a bit higher, pushing even group insurance policies beyond the budgets of many Americans. So you could look at having coinsurance as the method insurance companies use to be able to remain competitive in today's medical insurance markets.
Because some types of treatment and illnesses could incur very high coinsurance payments over time, most policies have a cap on the amount of coinsurance you must pay for a single form of treatment. Once you have paid that amount, your insurance will not require any additional coinsurance payments on that procedure. You will still have to make your coinsurance payments on other medical care, but at least you won't have to keep paying out of pocket for long term procedure.
Answered April 3, 2012 by Anonymous