Managed care
In terms of using such a plan, unlike an HMO plan, which has a copayment cost share feature (a nominal payment generally paid at the time of service), a PPO generally does not have a copayment but offers a deductible and a coinsurance feature. The deductible must be paid in full before any benefits are provided. After the deductible is met, the coinsurance benefits apply. If the PPO plan is an 80% coinsurance plan with a $1,000 deductible, the patient pays 100% of the allowed provider fee up to $1,000. The insurer will pay 80% of the other fees, and the patient will pay the remaining 20%. Charges above the allowed amount are not payable by the patient or insurer but written off as a discount by the physician.
Co-insurance
In health insurance, coinsurance is sometimes used synonymously with copayment, but copayment is fixed while the coinsurance is a percentage that the insurer pays after the insurance policy's deductible is exceeded, up to the policy's stop loss. It can be expressed as a pair of percentages with the insurer's portion stated first, or just a single percentage showing what the insured pays. The percentage due from the insured can range up to 100% (100% meaning the insured pays all costs until reaching the out of pocket maximum). Once the insured's out-of-pocket expenses equal the stop loss the insurer will assume responsibility for 100% of any additional costs. 70–30, 80–20, and 90–10 insurer-insured coinsurance schemes are common, with stop loss limits of $1,000 to $3,000 after which the insurer covers all expenses.