What does a deductible refer to in insurance?

A deductible in insurance is the specific amount of money that a policyholder must pay out-of-pocket for healthcare services before the insurance company begins to cover its share of costs. This concept is integral to how many health insurance plans are structured, as it helps to mitigate costs for insurers by requiring individuals to share in their healthcare expenses.

When a patient has a deductible, they are responsible for paying the full cost of their medical expenses, such as doctor visits or medications, until they reach the predetermined deductible amount. Once the deductible is met, the insurance plan typically starts to pay a portion of the costs, which can significantly reduce the patient's financial burden for subsequent services.

This understanding is crucial for patients to manage their healthcare finances effectively and to know when their insurance coverage will start to provide assistance.