What is the key feature of a deductible in health insurance?

The key feature of a deductible in health insurance is that it represents the amount of money the insured must pay out-of-pocket for healthcare services before the insurance policy begins to cover costs. When an individual incurs medical expenses, they are responsible for covering these costs up to their deductible limit. Only after this threshold is met does the insurance provider start to pay for covered services, usually in accordance with the policy terms and conditions.

This mechanism serves to share the financial responsibility between the insurer and the insured, encouraging individuals to utilize healthcare services judiciously. It is important for individuals to understand their deductible amount, as this can affect their overall healthcare spending and insurance utilization.

The other options refer to different aspects of health insurance. While the premium is a regular payment made to maintain coverage, it does not influence the deductible. Similarly, the coverage limit pertains to the maximum amount the insurer will pay over the policy term, and copayments are fixed amounts paid for specific services that often occur after the deductible has been met. Each of these components plays a role in health insurance, but they do not define the purpose and function of the deductible itself.