Copay
Also called copayment
A fixed dollar amount paid for a specific covered service, such as a doctor visit or prescription, with the insurer covering the rest.
What it means
A copay, or copayment, is a flat fee set by the plan for certain services, such as $30 for a primary care visit or $15 for a generic prescription. Copays vary by service type and are usually higher for specialists, urgent care and brand-name drugs, and out-of-network care may cost more or not be covered.
Depending on the plan, some services require only a copay even before the deductible is met, while others apply the deductible and coinsurance first. On most plans, copays count toward the out-of-pocket maximum, though not toward the deductible.
Example
Suppose a health plan has a $400 monthly premium, a $1,000 deductible, 20% coinsurance, a $30 primary care copay and a $4,000 out-of-pocket maximum. A routine doctor visit costs this person $30 regardless of the deductible, and five such visits ($150) count toward the $4,000 out-of-pocket maximum.
How it’s used
- Estimating the cost of routine care
- Comparing prescription coverage
- Choosing between plan options
Related terms
Educational information only, not financial, tax or legal advice. Rules, limits and rates change; check the IRS, your lender or plan, or a qualified professional before acting.