What does "coinsurance" refer to in health insurance plans?

Coinsurance refers specifically to the arrangement in health insurance where the insured individual shares a percentage of the costs of covered medical services after the deductible has been met. This means that once the policyholder has paid the deductible, which is the initial out-of-pocket expense before the insurer starts to pay, they will then pay a certain percentage of subsequent treatment or service costs, while the insurer covers the remaining percentage.

For example, if the coinsurance is set at 20%, after the deductible is satisfied, the policyholder would pay 20% of the costs for any further medical care, and the insurance company would pay the remaining 80%. This arrangement helps distribute healthcare costs between the insurer and the insured, incentivizing the policyholder to consider costs associated with their healthcare decisions.

The other options do not accurately describe coinsurance. The total amount paid by the insurer for extensive treatments relates more to benefit coverage limits rather than coinsurance. A fixed amount for each medical service corresponds to copayments, not coinsurance. Finally, the sum paid by patients before coverage kicks in refers to the deductible, which precedes any coinsurance calculation.