What is a copayment?

A copayment is a fixed amount the insurance company has determined that a covered individual will pay for services. The copayment amount is typically $25 or less but may vary depending on the service needed. For instance, a plan may call for the insured individual to pay $25 for a general doctor's visit, $50 for a visit to a specialist, and $10 for a prescription.

In some plans, though not all, the deductible must be met first before a copayment becomes applicable. That is, the insured individual may need to pay the full amount for a prescription or doctor's visit until they've reached their plan's deductible. Once the deductible has been met, the only out-of-pocket cost will be the copayment for the service until they've reached their out-of-pocket limit.

Learn more about copayments

When do I need to be aware of a copayment?

Whenever you seek out medical service, you should be aware of what your potential copayment will be. Some plans may offer the ability to immediately make only copayments without reaching the deductible. Copayment amounts can change year-to-year, so it's essential to reach out to your insurance company at the beginning of the year to see if there have been any price adjustments.

What is important to know about a copayment?

A copayment is part of the cornucopia of insurance payment terms that are related but ultimately different:

Copayments are always a fixed amount while coinsurance is always a percentage of the total cost of the service.
An insurance plan can include both copayments and coinsurance.
A plan's deductible is the amount you must pay before your insurance begins to cover costs, and some plans may require an individual to pay for services in full without a copayment until the deductible is reached.
Premiums are the monthly amount an individual must pay to continue their insurance coverage.
Typically, plans with higher premiums have lower copayment amounts and vice versa.