Health insurance lingo can be confusing. What is the difference between a copayment and coinsurance? What is a deductible? Understanding how each works will help you know how much you will pay out-of-pocket for covered services. 

Defining Health Care Cost Terminology 

Out-of-Pocket Limit 

The most you could pay during a coverage period (usually one year) for your share of the costs of covered services. After you meet this limit, the plan will usually pay 100% of the allowed amount. This limit helps you plan for health care costs. This limit never includes your premium, balance-billed charges or health care your plan doesn’t cover. Some plans don’t count all your copayments, deductibles, coinsurance payments, out-of-network payments, or other expenses toward this limit. 


An amount you could owe during a coverage period (usually one year) for covered health care services before your plan begins to pay. An overall deductible applies to many covered items and services. A plan with an overall deductible may also have separate deductibles that apply to specific services or groups of services. A plan may also have only separate deductibles. 


Your share of the costs of a covered health care service, calculated as a percentage (for example, 20%) of the allowed amount for the service. You generally pay coinsurance plus any deductibles you owe.  


Your copayment is the amount you pay for a covered service. Your copayment amount will not change throughout the year, and usually does not count towards your deductible. For example, you may pay $15 each time you see your primary care provider.  

How These Costs Apply to Your Plan 

To put your costs into perspective, let’s explore these terms based on the High Option Compass Rose Health Plan rates for 2023.

Example 1: Compass Rose Health Plan High Option Deductible (for self only) is $350 

If your plan's deductible is $350, you'll pay 100% of eligible covered services and supplies until you reach $350. Once you have met your deductible, your co-insurance will kick in. 

Example 2: Compass Rose Health Plan High Option Coinsurance is 10% 

If you have 10% coinsurance, you pay 10% of the allowed amount of the bill, and your health insurance will cover 90%, once you meet your deductible. 

Example 3: Compass Rose Health Plan High Option Out-of-Pocket Max (for self only) is $5,000 

You reach your $5,000 out-of-pocket maximum after undergoing a medical procedure. Now, your plan will pay the full cost of your covered services for the remainder of the year.