We know health insurance has its own language with different terms, like “deductibles,” “coinsurance” and “copayments.” Once you get a good grasp on some of these basic terms, you’ll see how simple health insurance can be. Let’s start by defining these terms: 

Deductible: This is a set amount you have to pay toward your medical bills every year before your insurance company starts paying. It varies by plan and some plans have no deductible. 

Premium: This is the amount you pay your health insurance company to keep your coverage active. Most people pay their premium monthly. 

Coinsurance: This is the percentage of your medical bill you share with your insurance company after you’ve paid your deductible. Unless you have a policy with 100 percent coverage for everything, you have to pay a coinsurance amount. For example, if you have a $100 doctor’s bill and your plan covers 80 percent of it, your coinsurance amount due to the doctor’s office is 20 percent, or $20. 

Copayment (or “Copay”): Your copayment, or copay, is the flat fee you pay every time you go to the doctor or fill a prescription. It’s usually a relatively small dollar amount. Copays do not count toward your deductible. 

There are other insurance terms that may be confusing to you, but starting with these four is a good foundation. You can always check our glossary for more terms and definitions.