What is a co-pay in the context of health insurance?

In the context of health insurance, a co-pay is a predetermined fixed fee that the insured must pay for specific healthcare services, such as a doctor's visit or a prescription medication. This payment is made at the time of service and is typically a set amount agreed upon in the health insurance policy. Co-pays are designed to share the cost of care between the insurer and the insured, which helps to control overall healthcare expenditures and encourage responsible use of medical services.

This structure also makes it easier for policyholders to understand their out-of-pocket costs at the time of receiving care, as they know in advance how much they will need to pay for certain services. It contrasts with other terms in health insurance, such as deductibles or premiums, which have different implications regarding the division of costs between the insured and the insurer.