What Is Coinsurance and Why Is Your 20% Never the Same Amount?

A copay is a number. A deductible is a number. Coinsurance is a percentage, and a percentage of a figure that has not been calculated yet. That single difference is why the clerk at the desk genuinely cannot tell you what you are going to owe.

What coinsurance actually is

HealthCare.gov defines it as "The percentage of costs of a covered health care service you pay (20%, for example) after you've paid your deductible."

Two conditions sit inside that sentence. It is a share, not an amount. And like a copay, it only starts once your deductible is behind you.

Twenty percent of what, exactly

This is the part that catches everybody. Your 20% is not 20% of the bill the provider sends. It is 20% of the allowed amount, the figure your insurer and that provider already agreed on, without you in the room.

HealthCare.gov's example: your plan's allowed amount for an office visit is $100 and your coinsurance is 20%.

If you have met your deductible, you pay 20% of $100, or $20, and the insurer pays the rest.

If you have not met it, you pay the full allowed amount, $100.

Where the number gets frightening

The same official example runs it again with a serious illness. Allowable costs of $12,000, a $3,000 deductible, 20% coinsurance, and a $6,850 out-of-pocket maximum.

You pay the first $3,000, all of your deductible.

Then you pay 20% of the remaining $9,000, which is $1,800 of coinsurance.

Your total is $4,800.

The same twenty percent that cost you $20 at an office visit. Nothing about your plan changed. Only the size of the number it was applied to.

Why nobody at the desk can tell you

The allowed amount is not settled until the claim is submitted and processed. Until then your coinsurance is a percentage of an unknown. The person in front of you is not being evasive. The number does not exist yet, and when it does, it will not come from their office.

The ceiling that does exist

Coinsurance is not unlimited. HealthCare.gov defines the out-of-pocket maximum as "The most you have to pay for covered services in a plan year." Once you reach it, your plan covers 100% of covered, in-network services for the rest of the year.

Read those two words carefully. Covered. In-network. Premiums do not count toward it, and neither do services your plan does not cover.

Four questions worth asking before a scheduled procedure

1. Is every provider involved in network, including the anaesthetist and the lab?
2. What is the allowed amount for this procedure under my plan?
3. How much of my deductible is left this year?
4. How close am I to my out-of-pocket maximum?

Find your own percentages

Your coinsurance rate, your deductible, and your out-of-pocket maximum are all in your policy, scattered across pages written to be skimmed. Drop it into MyPolicyShield and it surfaces all three, plus what changes the moment you go out of network.

One upload, and the percentage stops being a mystery.