Welcome back to the HealthyMarks Education Series. What is a Co-Pay? What is a Co-Insurance? Which is better? You may be thinking “I have no idea what the difference is.” And that’s okay. Let’s take a few minutes to better understand our health insurance.

A Co-Pay is a dollar amount that you will pay for your medical services.  A Co-Insurance is a percentage amount. 

For example, I went to my primary care physician and had a Co-Pay of $50.  I then took an x-ray and paid my Co-Insurance of 30%.

So which is better? A Co-Pay is always going to be better.

Reason One: Know you Cost

A Co-Pay is going to be a much simpler calculation to understand when looking at your plan details. When you see a “$” you know exactly how much you are paying out of your own pocket. A $50 Co-Pay is going to cost you $50. You can expect to pay that every time you see your primary care physician. 

Is it better to have a $700 Co-Pay for your hospital visit or a 30% Co-Insurance? Again, the Co-Pay is going to be less expensive.  Co-Pays are going to be a fixed dollar amount that is almost always less expensive than the percentage amount you would pay.  A plan with Co-Pays is better than a plan with Co-Insurances.

Reason Two: Choose your best Doctors

I visited Dr. Albert to evaluate my knee surgery. Dr. Albert says it will cost $3,000. Dr. Baldwin says it will cost $4,000… but I liked Dr. Baldwin a lot more. My plan has a Co-Pay of $900. I know I’m going to pay $900 no matter which doctor I see. 

However, let’s say I had a plan with a Co-Insurance of 30%.  To have my surgery with Dr. Albert, I’d pay $900 (30% of $3,000). I would pay $1,200 to have my surgery with Dr. Baldwin (30% of $4,000).  So a Co-Pay is better in this scenario allowing me to select the best doctor. 

Take a look at your own insurance plan and see which of your services are covered with a Co-Pay and which are not.