Health Insurance

Question 2 • 26-27 Ignite Financial Literacy Personal Finance - EL3403

What is the difference between a co-payment and co-insurance?

Answer

Co-payment refers to two spouses paying for the same coverage, and co-insurance refers to two spouses receiving the same benefits.

A co-payment is a flat fee for each service, and co-insurance is based on a percentage of the costs incurred.

Co-payment is when a group of individuals work to cover each other’s medical expenses, and co-insurance is when an individual has multiple insurance policies from different companies.

A co-payment is when an employer helps an employee pay for insurance premiums, and co-insurance is when an employer helps an employee find better insurance than they could alone.

Explanation

A co-payment is a set dollar amount you pay for a particular service, such as a doctor visit. Co-insurance is your share of the cost expressed as a percentage, such as 20% of a covered bill. Therefore, the correct choice is “A co-payment is a flat fee for each service, and co-insurance is based on a percentage of the costs incurred.”

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