In health insurance, what is a "co-payment"?

A co-payment is best described as a fixed fee that the insured pays for specific medical services at the time of receiving those services. This structure allows the policyholder to have a predictable out-of-pocket expense when they seek medical care. For example, a health insurance plan might stipulate a co-payment of $25 for a doctor's visit, meaning that the insured is responsible for that amount, while the insurance provider covers the remaining costs.

This system helps to manage the costs associated with health care by ensuring that the insured has a stake in their health care expenses, thereby reducing unnecessary visits and services. It is separate from other aspects of health insurance costs, such as deductibles or premiums. Understanding co-payments is essential for managing total health care costs and benefits under a health insurance plan.