Definition
Co-payment is a fixed amount that an insured individual must pay for a healthcare service at the time of service, while the insurance plan covers the remaining cost.
Why It Matters
Co-payments help share the cost of healthcare between insurers and patients, encourage responsible use of medical services, and reduce the likelihood of overutilization. They are a key feature in many health insurance plans and influence patient decision-making.
Example
For example, if a doctor’s visit costs $150 and the health insurance plan requires a $30 co-payment, the patient pays $30 at the visit, and the insurance covers the remaining $120.