What is a deductible in health insurance terminology?

A deductible in health insurance terminology refers to the amount an insured individual is required to pay out-of-pocket for healthcare services before their insurance begins to cover the costs. This amount must be met by the insured before the insurance plan contributes to medical expenses, such as hospital visits or treatment costs.

For example, if a policy has a deductible of $1,000, the insured would need to pay that amount in eligible healthcare expenses before the insurance provider starts to pay for claims. This structure helps to ensure that both the insured and the insurer share in the costs of medical services, and encourages careful use of healthcare resources.

Understanding deductibles is crucial for policyholders because it impacts how much they will need to budget for their healthcare expenses at the start of a policy period.