Coinsurance vs. Copay: Which One Do I Have?

Figuring out the terms in your insurance plan can seem like reading a foreign language, especially health insurance. However, it is essential to understand what the terms mean so you can have a reasonable estimate of your out-of-pocket costs for different services. Two terms you may have seen are coinsurance and copay - what do they mean, and how do they affect your total cost? 

If you have questions about your insurance plan, we recommend reaching out to your provider. Still, the front desk staff at your medical facility can also answer cost-related questions - our front desk and billing staff at EW Motion Therapy excel at this with every patient they interact with. This article will help you understand the differences between coinsurance and copays by defining each term and providing a real-life example.  

What is the difference between coinsurance and copay? 

In terms of health insurance, coinsurance and copay are two different things, and you will likely only have one with your insurance plan, but it varies based on your provider. Coinsurance is a fixed percentage of the total cost of your service that you pay to your insurance company after your deductible is met. After you meet your deductible, for example, your insurance will pay between 70 and 80% of the cost of your service, and your coinsurance will be the remaining 20-30%. 

A copay, on the other hand, is a flat rate you pay for your service after your deductible is met. Your copay for different services can change based on the service, your contract, and your insurance company, so the best way to determine your copay for each service is to check with your provider. 

Your copay or coinsurance payments may change if you have secondary insurance. For example, after you meet your deductible for your primary plan, your secondary insurance may pick up your coinsurance or copay, once you meet the deductible for your secondary insurance. Both coinsurance and copays come into play only after you meet your deductible. 

Copay vs. coinsurance example 

The best way to see the difference between copays and coinsurance is with a real-life example. Let’s look at Davis - he is coming to physical therapy after surgery on his ACL, which he tore playing football. Once Davis meets the $1,000 deductible on his insurance plan, his plan states that he has to pay a $25 copay at each physical therapy appointment. But Davis’ teammate Matthew is in physical therapy for a torn meniscus, and under his insurance plan, which has a $3,500 deductible, he has 20% coinsurance that he pays at each appointment. Both football players have payments at each appointment after meeting their deductible, but Davis’s payment is a flat rate, while Matthew’s is a fixed percentage.  

What other insurance information do I need to know? 

Now you understand the difference between coinsurance and copays. Before you pay for health services like physical therapy, you must know the specifics of your insurance plan. Your provider will likely ask you to fill out your insurance information on your intake paperwork before your first appointment. However, it is still a good idea to bring your insurance card or other information with you so your provider can save a copy for your records. 

It can be confusing to navigate pricing for medical services, especially physical therapy. If you need to figure out how much you will pay for physical therapy, feel free to check out our physical therapy pricing guide or our health insurance guide.