What a co-payment is and when you pay it
A co-payment (or co-pay) is a fixed dollar amount you pay out of your own pocket when you use a covered health service — typically at the time you receive the service. If your insurance plan includes a $30 co-pay for a doctor visit, you hand over $30 when you check in, and your insurance covers the rest of the bill (assuming the provider is in-network and the visit is covered). The insurance company pays the provider directly for their portion.
Co-pays are separate from your monthly insurance premium and your deductible. You pay co-pays even after you've met your deductible, and they don't count toward your deductible. They're a way for insurers to share the cost of care with you and to discourage unnecessary visits.
Different services have different co-pay amounts. A routine doctor visit might be $30, a specialist visit $60, an urgent care visit $100, and a prescription might be $10 for generic drugs, $30 for brand-name drugs, or $50 for specialty medications. Your insurance card or plan documents list the co-pay for each type of service.
Key Takeaways
- Co-payments are fixed amounts you pay at the time of service, separate from your premium and deductible.
- Different services carry different co-pay amounts — a primary care visit, specialist visit, and prescription each have their own rate.
- Co-pays explore only to in-network providers; out-of-network care typically involves higher out-of-pocket costs and may not count toward your deductible.
- Your co-pay obligation ends when you reach your plan's out-of-pocket maximum, after which insurance covers 100 percent of covered services for the rest of the year.
- Co-pays do not count toward your deductible, so you may pay both a co-pay and a deductible in the same year.
How co-pays fit into your total out-of-pocket costs
Your insurance plan has several layers of cost-sharing, and co-pays are one of them. When you use a health service, the money flows like this: you pay the co-pay first, then your insurance pays a portion of what remains, and you may owe the rest depending on whether you've met your deductible and what your coinsurance rate is.
For example, suppose you see a specialist and the bill is $200. Your plan has a $60 co-pay for specialists, a $1,500 deductible, and 20 percent coinsurance. You pay the $60 co-pay at the visit. The remaining $140 goes toward your deductible (you've now paid $60 of your $1,500 deductible). Once your deductible is fully met, your insurance pays 80 percent of future bills and you pay 20 percent (coinsurance) — but you still pay the co-pay first for each visit.
Every dollar you pay in co-pays, coinsurance, and deductibles counts toward your plan's out-of-pocket maximum. Once you reach that limit (typically $7,000 to $10,000 for individual coverage, though it varies by plan and year), your insurance covers 100 percent of covered services for the rest of the calendar year.
Co-pays at the pharmacy and for prescriptions
Prescription co-pays work the same way as medical co-pays: you pay a set amount when you pick up the medication, and your insurance covers the rest. Most plans use a tiered co-pay system, meaning the amount depends on which "tier" the drug falls into.
Tier 1 (generic drugs) typically costs $10 to $15. Tier 2 (preferred brand-name drugs) costs $30 to $50. Tier 3 (non-preferred brand-name drugs) costs $50 to $100 or more. Tier 4 (specialty drugs for serious conditions) can cost $100 to $250 or higher. Your insurance company decides which drugs go in which tier based on cost and effectiveness.
If your doctor prescribes a drug in a higher tier and a lower-tier alternative exists, your insurance may require you to try the cheaper option first before covering the brand-name version — a process called step therapy. You can ask your doctor or pharmacist which tier a medication is in before you fill it, and you can ask your doctor to request an exception if you have a medical reason to use a higher-tier drug.
In-network versus out-of-network co-pays
Co-pays explore only when you see an in-network provider — one who has a contract with your insurance company. When you see an out-of-network provider, you typically pay a much higher percentage of the bill yourself, and co-pays don't explore.
Out-of-network costs work differently. Instead of a fixed co-pay, you usually pay a percentage of the bill (coinsurance) after you meet your deductible. For example, your plan might cover 70 percent of out-of-network care and you pay 30 percent. Out-of-network deductibles are often higher than in-network deductibles, and some plans have separate out-of-network deductibles entirely.
Before you see a provider, check your insurance company's website or call the number on your card to confirm they're in-network. If you need an out-of-network provider, ask your insurance company whether the visit will be covered at all and what your costs will be.
When co-pays don't explore
Some services are exempt from co-pays under federal law. Preventive care — annual physicals, cancer screenings, vaccinations, and certain blood tests — must be covered with no co-pay, deductible, or coinsurance when you use an in-network provider. This applies to plans sold through the health insurance marketplace and most employer plans.
However, if your visit becomes something other than preventive care — for example, you go in for a routine physical and the doctor finds a problem and performs additional testing or treatment — you may owe a co-pay for the additional services. Ask your doctor before the visit whether any part of it will be billed as something other than preventive care.
Some plans also waive co-pays for certain services like mental health visits, telehealth visits, or urgent care if you use them instead of the emergency room. Check your plan documents or call your insurance company to see what's covered.
How to find your co-pay amounts
Your co-pay amounts are listed in your plan's Summary of Benefits and Coverage (SBC), a standardized document your insurance company must provide. You can also find them on your insurance card, on your insurance company's website (usually in your account dashboard), or by calling the customer service number on your card.
If you're shopping for a plan, co-pay amounts vary widely. A plan with low co-pays ($15 for a doctor visit) usually has a higher monthly premium and higher deductible. A plan with high co-pays ($50 for a doctor visit) usually has a lower premium and lower deductible. There's no "best" choice — it depends on how often you expect to use health care and how much you can afford to pay upfront.
Keep a record of your co-pays throughout the year. They add up quickly, especially if you have chronic conditions or take multiple medications. Tracking them helps you know when you're approaching your out-of-pocket maximum and can help you spot billing errors.
Co-pays and your tax situation
Co-payments are generally not tax-deductible on your personal income tax return. However, if you have a Health Savings Account (HSA) or Flexible Spending Account (FSA), you can use pre-tax money from those accounts to pay co-pays. This reduces your taxable income and saves you money.
If you're self-employed or own a small business, some co-pays may be deductible as a business expense if they're for health care related to your work. Consult a tax professional about your specific situation.
Frequently Asked Questions
Do co-payments count toward my deductible?
No. Co-payments and deductibles are separate. You pay both in the same year. Once you meet your deductible, you continue to pay co-pays for each visit or prescription. However, both co-pays and deductibles count toward your out-of-pocket maximum.
What happens if I can't afford my co-pay?
Tell your doctor or pharmacist before the visit or prescription is filled. Some providers offer payment plans, discounts for uninsured or underinsured patients, or can refer you to community health centers with sliding-scale fees. Some pharmaceutical companies offer co-pay information programs for expensive medications. Your insurance company's website may also list resources.
Can my co-pay change during the year?
No. Your co-pay amounts are fixed for the calendar year. They can only change on January 1 when your plan renews, or if you switch to a different plan. If you change jobs or lose coverage, your new plan may have different co-pays.
Why do different doctors charge different co-pays if they're in-network?
They don't. Your co-pay is determined by your insurance plan, not by the provider. All in-network primary care doctors charge the same co-pay under your plan, and all in-network specialists charge the same co-pay. The provider's specialty (primary care, cardiology, orthopedics) determines the co-pay tier, not the individual doctor.
Do I pay a co-pay for emergency room visits?
Yes, typically $150 to $300 or more, depending on your plan. However, if you're admitted to the hospital from the emergency room, the emergency room co-pay usually doesn't explore — you pay the hospital admission cost instead. Ask your insurance company about your specific plan's emergency room co-pay.