Which of the following best describes coinsurance?

Coinsurance refers to the arrangement in which an insured individual is responsible for paying a specific percentage of medical expenses after they have met their deductible. This means that once the insured has satisfied their deductible requirement, which is the predetermined amount they must pay out of pocket for covered services, they will then share the costs of further medical services with their insurance company based on the agreed-upon percentage.

For example, if a health insurance policy has a coinsurance provision of 20%, after the deductible is met, the insured will pay 20% of the medical costs, while the insurance company covers the remaining 80%. This arrangement often encourages patients to be mindful of healthcare costs since they have a financial responsibility for a percentage of the expenses incurred.

The other options describe different elements of health insurance. A refers to a copayment, which is a fixed amount paid for a specific service, while C describes a deductible, which is the total amount payable before insurance benefits kick in. D pertains to the out-of-pocket maximum, which caps the total costs an insured person might pay in a policy year, after which the insurance covers 100% of the costs. Each of these terms is distinct from coinsurance, highlighting the unique role that coinsurance plays in cost-sharing