Deductibles, copays and coinsurance are three different ways a health plan shifts cost onto the patient, and they stack rather than substitute. A deductible is what you pay before the plan pays anything. A copay is a flat fee per service. Coinsurance is a percentage of the bill. Most plans use all three at once, in a sequence, which is why the amount owed after a procedure so rarely matches what anyone expected.
The questions below produce the most confusion. Figures come from KFF’s 2025 Employer Health Benefits Survey, which surveyed 1,862 employers with ten or more workers between January and July 2025.
What is a deductible?
A deductible is the amount you pay out of pocket for covered services before your plan starts paying. Once you meet it, the plan begins sharing costs according to the other terms.
KFF found that 88 percent of covered workers with single coverage had a general annual deductible in 2025, and the average was $1,886, up from $1,773 in 2024. The average is misleading on its own. At small firms with 10 to 199 workers the average deductible was $2,631, against $1,670 at larger firms.
Preventive services are generally exempt. Under the Affordable Care Act, a set of preventive services must be covered without cost sharing even when the deductible has not been met, which is why an annual physical can cost nothing while an X-ray on the same day costs full price.
What is a copay?
A copay is a fixed dollar amount for a specific service, set in advance and unrelated to what the service actually costs. You pay $30 for the visit whether the plan is billed $90 or $400.
KFF found average 2025 copays of $27 for a primary care office visit and $45 for a specialist visit, with the specialist figure higher than in 2024. Outpatient surgery carried an average copay of $186 among plans using one, and hospital admissions an average copay of $313.
Copays are predictable, which is their entire advantage. They also hide the underlying price, which is their disadvantage, and it is the reason patients often have no idea what their care costs until a plan changes the terms.
What is coinsurance?
Coinsurance is a percentage of the allowed amount rather than a fixed fee. If coinsurance is 20 percent and the plan’s allowed amount is $4,000, you owe $800.
KFF found average coinsurance rates of 19 percent for both primary care and specialist visits in 2025. For hospital admissions, 65 percent of covered workers had coinsurance, 11 percent had a copay and 8 percent had both, with the average coinsurance rate at 20 percent.
Coinsurance is where large bills get large. A percentage of a small number is small. A percentage of a hospital admission is not.
How do they work together on one bill?
They apply in order: deductible first, then coinsurance or copay, until the out-of-pocket maximum stops the accumulation. Working through a single example makes the sequence clear.
Take a single-coverage plan with the 2025 average deductible of $1,886 and 20 percent coinsurance, and an outpatient procedure with an allowed amount of $12,000. The first $1,886 is yours, because the deductible has not been met. That leaves $10,114 subject to cost sharing. At 20 percent coinsurance, you owe $2,022.80 of it. Total patient responsibility: $3,908.80.
Two details change that result. If you had already met the deductible earlier in the year, you would owe only the coinsurance, $2,400 on the full $12,000. And if the provider were out of network, none of these figures would necessarily apply.
What is an out-of-pocket maximum?
The out-of-pocket maximum is the ceiling on what you pay for covered in-network services in a plan year. Once you hit it, the plan covers 100 percent of covered in-network care for the rest of the year.
Federal law caps this figure for Marketplace plans. HealthCare.gov lists the limit at $9,200 for an individual and $18,400 for a family in 2025, rising to $10,600 and $21,200 in 2026.
Employer plans vary below those caps. KFF found 72 percent of covered workers faced an out-of-pocket maximum above $3,000 for single coverage in 2025, 21 percent above $6,000, and 12 percent at $2,000 or less. Premiums do not count toward it, and neither does out-of-network care in most plans.
What does coverage cost before any of this?
Premiums are separate from all three cost-sharing mechanisms and are paid whether or not you use care. KFF found the average annual premium in 2025 reached $9,325 for single coverage, up 5 percent, and $26,993 for family coverage, up 6 percent or $1,408.
Workers paid 16 percent of the single premium and 26 percent of the family premium on average, amounting to $1,440 and $6,850 respectively. Firm size drives an enormous split: workers at firms with 10 to 199 employees contributed an average of $8,889 toward family coverage, against $6,227 at larger firms. KFF found 29 percent of covered workers at small firms must contribute more than half the family premium, against 5 percent at larger firms.
Why have deductibles risen so fast?
Deductibles have risen because employers absorbed premium increases by shifting more cost to the point of care. The average single deductible rose 17 percent over five years and 43 percent over ten.
The distribution shifted further than the average suggests. KFF found 34 percent of covered workers were in a plan with a single deductible of $2,000 or more in 2025, up from 32 percent in 2024. That share has risen 32 percent over five years and 77 percent over ten. At small firms, 53 percent faced a deductible of $2,000 or more and 36 percent faced $3,000 or more.
For context on scale, KFF found family premiums rose 26 percent over five years while inflation ran 23.5 percent and wages 28.6 percent across the same period. The premium trend roughly tracked wages. The deductible trend did not.
What is a high-deductible health plan?
A high-deductible health plan pairs a larger deductible with lower premiums, and some versions qualify for a tax-advantaged health savings account. The IRS sets the minimum deductible and maximum out-of-pocket thresholds that determine whether a plan qualifies.
Enrollment figures require care. KFF reported that 29 percent of covered workers were enrolled in a high-deductible plan usable with a health savings account, while 33 percent were in a broader category called a high-deductible plan with a savings option, which also includes plans paired with health reimbursement arrangements. Those are different denominators, not conflicting counts.
Does a low premium mean a good plan?
No. Premium and cost sharing move in opposite directions by design, so a cheaper premium generally means a larger deductible, higher coinsurance, or both.
KFF’s 2025 data shows the pattern directly: high-deductible plans with a savings option averaged $8,620 for single coverage and $25,379 for family, while preferred provider organization plans averaged $9,818 and $28,272. The comparison that matters is total annual exposure, meaning premium plus deductible plus expected coinsurance up to the out-of-pocket maximum, not the monthly figure on the paycheck.
That total is what organizations working on household affordability point to when they argue that having insurance and being able to afford care have become separate questions. Fight For A Living Wage, a nonpartisan grassroots 501(c)(3), counts healthcare among the basics a full-time wage should cover, alongside housing, childcare and food. The cost-sharing figures above are the reason coverage alone no longer settles that question.
