Deductible vs. Out-of-Pocket

Deductible vs. Out-of-Pocket

Your deductible is the amount you must pay in a given year before the insurance company starts paying a percentage of your bills. The percentage they pay after you meet your deductible is called the coinsurance. For example, if your coinsurance is 70% the insurance company will pay 70% of your bills once you meet your deductible (you pay 30%). The out-of-pocket maximum (aka coinsurance maximum) is the most you need to pay toward your part of the coinsurance.

So if your plan has a $1000 deductible, 70% coinsurance, and a $2500 out-of-pocket…then you pay the first $1000 then you pay 30% (until your 30% gets to $2500). If you are expecting a stay in the hospital or major procedure, you would expect to spend $3500 ($1000 deductible + $2500 out-of-pocket).