Deductible, Copay, Coinsurance and Out-of-Pocket Maximum
October 19, 2026 ยท 4 min read
Health plans use four terms that sound alike and work differently. Understanding them makes it much easier to compare plans and to avoid a surprise bill.
New York licensed agent and broker
The premium is what you pay to keep the plan active, usually monthly, whether or not you use care. The deductible is the amount you pay for covered services before the plan starts to share the cost, though some services may be covered before you meet it.
A copay is a fixed amount you pay for a specific service, such as a visit or a prescription. Coinsurance is a percentage of the cost you pay after the deductible is met. The out-of-pocket maximum is the most you pay for covered, in-network care in a plan year, not counting premiums. After you reach it, the plan pays covered in-network costs for the rest of the year.
Add the yearly premiums to the amount you would pay in a year with a lot of care, which is roughly the out-of-pocket maximum. Then add the premiums to the amount you would pay in a year with very little care. The two totals show you the range of what the plan could cost. A plan with a lower premium and a higher deductible is not automatically lower in cost, and the reverse is also true.
Costs apply differently for in-network and out-of-network care. Confirm that your doctors, hospitals and pharmacies are in the network before you choose. Ask whether a referral or prior approval is required for specialists and procedures.
Every plan has a summary of benefits and coverage that follows a standard format. Use it to compare plans side by side. If something is unclear, ask us or the insurer before you enroll.
Do premiums count toward the out-of-pocket maximum?
Generally no. The maximum applies to covered, in-network cost sharing, not to premiums or to services the plan does not cover.
What is a high-deductible plan?
A plan with a higher deductible, which usually comes with a lower premium. Check whether it is paired with a health savings account and whether you are eligible, and ask your accountant about tax treatment.
By Ardi Shita, New York licensed agent and broker (NPN 22062424), The Rothswell Agency LLC. Published October 19, 2026. General information, not advice. Laws, programs and deadlines change, so confirm current details before you act.
We work in your best interest. At or before the time of application we will tell you whether we are acting as your broker or as the insurer's agent, and whether we receive compensation from the insurer. You can ask for details of our compensation at any time (New York Regulation 194).
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