Coinsurance is one of the most confusing parts of health insurance. You pay a premium every month, but then there are deductibles, copays, and coinsurance too. It can get complicated quickly.
One common coinsurance question is: what does 0% coinsurance mean after you meet your deductible?
Let’s break it down step-by-step so you know exactly what 0% coinsurance means for your health expenses.
What is Coinsurance?
First, a quick refresher on what coinsurance is.
Coinsurance is the percentage of costs you pay for medical services and medications once you’ve met your annual deductible. For example, if you have a 20% coinsurance, you pay 20% of the total bill and your insurance covers the other 80%.
The coinsurance rate applies to things like:
- Doctor visits
- Prescription medications
- Lab tests
- X-rays
- Hospital stays
- Therapy
- Surgeries
Coinsurance is different from copays, which are flat fees you pay upfront for services – for example, a $30 copay to see your primary care doctor.
How Deductibles and Coinsurance Work Together
Now, how do deductibles fit into the coinsurance equation?
Your deductible is the amount you have to pay out-of-pocket before your insurance starts helping with costs. Common deductible amounts are $1,000, $2,000, or $5,000 per year.
You pay 100% of medical costs yourself until you hit your deductible. Only then will your coinsurance kick in.
For example, let’s say your deductible is $2,000 and you have a 20% coinsurance:
- You pay the first $2,000 of medical bills yourself
- Once you hit $2,000, your insurance starts chipping in
- You now pay 20% of any additional covered expenses, while insurance covers 80%
The deductible must be met before any coinsurance applies.
What Does 0% Coinsurance Mean?
Now we get to the key question – what does 0% coinsurance mean after you meet your deductible?
0% coinsurance means you pay $0 out-of-pocket for covered medical services after meeting your deductible. Your insurance picks up 100% of the tab.
For example, let’s say your deductible is $1,000 and your coinsurance is 0%:
- You pay the first $1,000 to cover medical expenses
- Once your deductible is met, your insurance covers 100% of any additional covered costs
- You pay $0 coinsurance for the remainder of the year
This is an ideal situation – you only have to worry about the deductible, then the rest of your care is fully covered. No surprise coinsurance bills in the mail.
Some key things to note about 0% coinsurance:
- You must still pay your deductible first before the 0% rate applies
- It only applies to in-network providers – out-of-network care may not be covered at 0%
- Services not covered by your plan aren’t eligible for the 0% rate
- You’ll still have copays for medications, office visits, etc.
Examples of 0% Coinsurance Policies
To better understand 0% coinsurance in action, let’s look at some examples from real health insurance policies.
Bronze Plan with $6,500 Deductible
One example is a Bronze plan with a $6,500 deductible and 0% coinsurance.
This means:
- You pay the first $6,500 of medical costs yourself
- Once you hit the $6,500 deductible, your insurance covers 100% of additional in-network costs
- You pay $0 coinsurance after meeting the deductible
However, this plan has high out-of-pocket costs before coverage kicks in. It may work well for relatively healthy people who rarely need medical care during a year.
Gold Plan with $1,000 Deductible
On the other end is a Gold plan with a $1,000 deductible and 0% coinsurance.
In this case:
- You pay the first $1,000 of medical expenses
- After your deductible is met, your insurance covers 100% of additional covered costs
- You have $0 coinsurance payments
This is a good option if you expect substantial medical expenses. Your out-of-pocket costs are lower before coverage kicks in fully.
HMO Plan with $3,000 Deductible
HMOs also offer 0% policies, like this HMO with a $3,000 deductible and 0% coinsurance.
The sequence goes like this:
- Meet $3,000 deductible
- Insurance covers 100% of additional in-network costs
- You pay $0 coinsurance
Keep in mind with an HMO your care must be coordinated through your primary care doctor and network. But you get robust coverage with no coinsurance after meeting the deductible.
The Pros and Cons of 0% Coinsurance
What are some potential advantages and disadvantages of a 0% coinsurance health plan?
Pros:
- Predictable costs – you know your maximum expenses for care upfront
- Full coverage after the deductible is met
- No surprise coinsurance bills to worry about
- All additional covered care is 100% paid for by insurance
Cons:
- Premiums may be higher than plans with coinsurance
- If you don’t meet the deductible, you pay the full cost of care
- Out-of-network care may not be covered
- Copays for medications, office visits, etc still apply
Whether 0% coinsurance is right depends on your expected healthcare needs and budget. It works well if you anticipate high medical costs during the year.
Who Should Consider 0% Coinsurance?
Here are a few examples of when 0% coinsurance may be beneficial:
Chronic health conditions – If you have an ongoing condition like diabetes or asthma that requires regular treatment, a 0% plan can help cap costs once you meet your deductible.
Planning a surgery – Know you’ll need a major procedure this year? A 0% policy means once your deductible is met, the surgery and follow-up care are fully covered.
Frequent medical needs – Do you see specialists often and take several prescriptions? 0% coinsurance can help lower overall out-of-pocket costs.
Peace of mind – Prefer the predictability of knowing your maximum costs for care upfront? $0 coinsurance after the deductible provides that certainty.
High-deductible compatible savings – Want to pair a high deductible plan with an HSA? Look for 0% coinsurance.
How to Find a 0% Coinsurance Health Plan
If you decide 0% coinsurance could be a good fit, here are some tips for finding options:
Check your employer’s plan offerings during open enrollment. Look for $0 or 100% coverage after meeting deductible.
On the marketplace, use advanced search filters to see “coinsurance %” and filter to 0% plans.
Compare multiple plans. Don’t just look at the deductible, but coinsurance rates too.
Double check the “Summary of Benefits” for exact coinsurance language. Sometimes a high percentage (like 90%) is listed but indicates the amount the insurance covers (so you’d pay 10% as coinsurance).
Calculate total estimated out-of-pocket costs, factoring in premiums, deductible, copays, and coinsurance.
Enlist an insurance agent or broker to help explain options and find 0% coinsurance plans.
Questions to Ask About 0% Coinsurance Plans
When evaluating 0% coinsurance policies, here are some key questions to ask:
What is the deductible amount I must meet first?
Does the 0% rate apply to all covered services or just some?
Is the 0% rate only for in-network providers? What about out-of-network?
Are there copays for medications, office visits, or other services?
Is the 0% coinsurance guaranteed for the full plan year?
What is the monthly premium for this plan?
What is the total out-of-pocket maximum, including the deductible?
Are any benefits excluded from the deductible and coinsurance?
Getting clear answers to these questions will ensure you understand exactly what you can expect to pay if you choose a 0% coinsurance plan.
Maximum Out-of-Pocket Costs with 0% Coinsurance
One final point on total costs with a 0% coinsurance plan.
While you may pay $0 coinsurance after meeting your deductible, most plans do cap total out-of-pocket spending for the year. This is through the maximum out-of-pocket limit.
For example, a plan with a $2,000 deductible and 0% coinsurance may
