Which statement best describes the difference between coinsurance and a copayment?

• A. Coinsurance is a share of costs after deductible; Copayment is a fixed amount per service.
• B. Coinsurance is a fixed per-service fee; Copayment is a share of costs after deductible.
• C. Both are fixed monthly fees.
• D. Both are percentages of costs.

Answer: (B)

Copayment and coinsurance describe two different ways you share costs with a health plan.

A copayment is a fixed dollar amount you pay for a service or prescription at the time of service. The amount is the same regardless of the service’s total charge, which means you know exactly what you’ll owe for that visit or item.

Coinsurance, on the other hand, is your share of the cost expressed as a percentage of the allowed amount. This typically applies after you’ve met your deductible, and the insurer pays the rest. So if the allowed amount is $100 and your coinsurance is 20%, you’d be responsible for $20, with the plan covering the remaining $80 (until you reach any out-of-pocket maximum).

In short, copayment = fixed amount per service; coinsurance = percentage of costs after deductible. Some plans use both for different services, and timing can vary by plan design.