A health insurance plan is supposed to reimburse the cost of hospitalisation and charges a premium for it.
However, if the policyholder agrees to pay a certain percentage of the hospital bill, it is a case of co-payment.
In doing so, insurer charges a lesser premium. Importantly, the sum insured remains the same and is not reduced.
A co-payment is therefore a cost-sharing requirement under a health insurance policy that provides that the policyholder will bear a specified percentage of the admissible costs.
It is not necessary that there will be a co-payment feature in all plans but in a senior citizen health insurance plan it could be a mandatory feature.
In higher age groups as the premium rates are higher, a co-payment may provide some relief in term of affordability.
Some plans, however, ask for as much as 20% co-payment if the treatment is done at a non-network provider or / in a city different from where the plan was bought.
A
co-payment is therefore a cost-sharing requirement under a health
insurance policy that provides that the policyholder will bear a
specified percentage of the admissible costs.
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