types of copayment in mediclaime

One important aspect to be looked carefully at the time of buying a health insurance policy is co-payment clause. Under co-payment clause, when you make a claim, you need to pay a certain percentage of that amount. Co-pay lowers the premium, but can be restrictive. So, it is necessary to understand types of co-payment so that you can make a right decision.

There are basically three types of co-payment. Co-payment can be linked to age, geography or hospital.

Age: In terms of age, for senior citizens, co-payment is usually a regular feature in health insurance plans because they are considered high risk. So, to reduce risk and premium, insurers include co-payment.

Geography: The second type of co-payment is based on geographies. For those who live in smaller cities, insurers offer plans under which if the policyholder makes a claim in a smaller city, the insurer will pay the entire claim amount. But if the policyholder chooses to go to a bigger city, where the cost of hospitilisation is higher, the insurer will expect you to pay a certain percentage of the claim. The rationale behind this is that medical expenses in smaller towns is lower, so insurers charge such policyholders a lower premium with a condition to co-pay if the insured goes to a bigger city for treatment.

Network hospital: In the third type of co-payment, co-pay is introduced if you visit a non-network hospital. This helps insurers keep costs in check as it has pre-negotiated rates at network hospitals.