Should You Opt For Health Insurance With Co-Payment?
Healthcare costs in India in recent years have seen a sharp increase, in such a situation having health insurance for every individual has become crucial. Thankfully with insurance purchases becoming available online the entire process is now extremely simple. However, with online purchases, there are several plans to pick and choose from. Making an informed decision when purchasing insurance is crucial, but insurance terminology can often be confusing. One term that people are often unclear about is the ‘co-pay feature’ in health insurance. In this article, we will tell you everything you need to know about it.
What Does ‘Co-Pay’ Mean in Health Insurance?
Co-payment is a term used to define the act of sharing medical expenses between the insurance provider and the policyholder. The co-payment percentage is usually somewhere between 10-25 percent and determines the out-of-pocket cost for the policyholder when there is a medical bill. For example, if you have a health insurance plan worth Rs 5 lakh and the co-payment clause is 20 percent on a medical bill of Rs. 3 lakhs you will be required to pay Rs. 60,000 and the rest will be covered by the health insurance policy.
How is the ‘Co-pay Clause’ Applied in Health Insurance Policies?
There are several scenarios in which health insurance companies apply a co-pay condition:
- Age-Related: It is assumed that older people make more claims due to their naturally deteriorating health. To mitigate this risk, most insurance companies apply the co-pay clause on senior citizens.
- Type of Hospital: If the hospital you chose is not within the network of hospitals the health insurance company is tied to some insurers may apply a co-pay clause.
- Illness Related: This is usually related to claims made which include a pre-existing disease or a critical one.
- Region Related: The cost of medical care in small towns is lower than in metro cities, hence insurance premiums for those residing in such places are also lower. However, if you choose to get treated in the metro for some reason, there may be additional costs that are mitigated through a co-pay clause.
What is the Benefit of Co-pay? Should You Opt for it?
Co-payment affects the insurance premium. The higher the rate of your co-pay the lower the insurance premium. This is because the risk involved is lowered through the sharing of the cost. If you are young and are generally a fit person who gets sick rarely, having health insurance with a co-payment option could help you save on paying high insurance premiums. However, if there is a medical emergency of some sort, where the cost of medical treatment is high, it will lead to a heavy out-of-pocket cost.
Conclusion
In an overview, copayment is the sharing of the costs of medical care under a health insurance policy. With copayment, your insurance premium is lower but makes the out-of-pocket costs much higher. To know more about health insurance click here. If you want to purchase health insurance, you can now do it online. With just a few clicks you can compare health insurance companies, the plans they offer, check the health insurance premium calculator, and check their network of cashless mediclaim hospitals.
Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.
