Deductible

Deductible is the term used to describe the patient's initial responsibility for medical expenses.  A deductible applies to more traditional medical plans, and is paid in full by the policyholder. Only after a deductible is satisfied does the insurance company start to share in the expenses of providing medical services.  For example, if the deductible on a policy is $1,000, this means the patient is responsible for paying the first $1,000 of medical expenses each calendar year.

A deductible is sometimes applied to medical plans such as health maintenance organizations (HMO), preferred provider organizations (PPO), and point of service (POS) plans, when the patient seeks treatment outside the list of network providers.

Since a deductible is the responsibility of the patient, it is related to other fee sharing terms such as copayment and coinsurance.