Coinsurance

Coinsurance is a term normally associated with health insurance plans.  Coinsurance is the sharing of medical expenses between the policyholder and the insurance company.  Since payment of coinsurance is the responsibility of the policyholder, it is related to other fee sharing terms such as copayment and deductible.

Coinsurance usually occurs when the patient is enrolled in managed care plans such as health maintenance organizations (HMO), preferred provider organizations (PPO), and point of service (POS) plans.  Coinsurance is sharing of medical expenses when the patient goes outside the list of network providers associated with their medical plan.  Coinsurance is usually stated in terms of percentage. For example, if the coinsurance on a plan is 30%, this means the patient is responsible for 30% of the expenses associated with medical treatment outside of the network.  Coinsurance is usually applied after a deductible is first satisfied.