What is the annual amount that must be paid out of pocket before insurance benefits will kick in called?

The annual amount that must be paid out of pocket before insurance benefits will kick in is known as the deductible. This is a specific threshold that policyholders need to meet for their insurance to begin covering costs associated with covered services. Once the deductible is met, the insurance plan typically starts to pay a portion of the expenses, and the insured individual may then be responsible for co-payments or coinsurance for subsequent medical bills.

Other terms in the context help clarify the concept of deductible. A co-payment is a fixed fee that a patient pays for a specific service, such as a doctor's visit, at the time of service. Premium refers to the amount paid for an insurance policy, typically on a monthly basis, which secures access to health benefits but does not relate to the cost-sharing aspect after medical services are received. Coinsurance is the percentage of costs that a patient pays after their deductible has been met. Understanding these definitions provides clarity on how a deductible functions within the broader context of health insurance.