Healthcare costs can be confusing with private insurance. These charts explain common insurance terms by putting them into action. 3 example claims show how medical costs may affect your deductible, coinsurance, and out-of-pocket max across a given year.

1. What the heck is a deductible? Is coinsurance the same as copay? And why do I still owe the rest of this
bill? Health insurance can be a confusing jumble of jargon, but understanding just a few key terms – and how they
work together– can demystify your medical bills, and help you make informed decisions about your health care.
Terms (simplified):
• Premium - Your monthly payment to your insurance company
• Deductible - The amount you pay before your insurance plan pays (Does NOT include premium)
• Copay - A fixed amount that you pay for covered health services
• Coinsurance - A percentage that you pay for covered health services after deductible
• Out of Pocket Maximum - The MOST you’ll pay for covered health services in a plan year
(includes coinsurance, may include deductible, but will NOT include premium)
* Here’s how some example claims might stack up in a given year
Copay vs Deductible:
How Does Insurance Work?
DEDUCTIBLE - $2,000 COINSURANCE - 20% OOP MAX - $5,000
DEDUCTIBLE PAID INSURANCE PAID
OOP MaxDeductible
You Pay:
$300
Remaining Deductible - 1,700 Remaining OOP Max - 4,700
Plan Pays:
$0
Example Cost for Claim 1
Respiratory Illness
Test/Meds - $300
OOP MaxDeductible
You Pay: $1,700
remaining of deductible
Remaining OOP
Max - 2,640
$360
Example Cost for Claim 2
Broken Arm
Hospital visit with
x-rays - $3,500
+ $360 20% coinsurance of cost
after deductible = $2,060
Deductible Met on this claim
Example Cost for Claim 3
Knee Surgery - $20,000
You Pay: $0 remaining of deductible + $2,640 remaining
on OOP max (coinsurance would otherwise be $4,000)
Plan Pays $1,440
OOP MaxDeductible
You Pay $2,640
Deductible Met on Claim 2 OOP Max met on this claim
Insurance Pays 17,360
Knee Surgery
Deductible OOP Max Designed by Aeroflow Healthcare
https://aeroflowinc.com