What does copayment mean in the context of health insurance?

In the context of health insurance, a copayment is defined as the fixed amount that a policyholder is required to pay for a specific healthcare service at the time the service is rendered. This payment structure is designed to share the cost of care between the insurance provider and the insured individual. For example, when visiting a doctor, the insured might pay a copayment of $20 while the insurance covers the rest of the visit's cost. This system encourages policyholders to seek medical care while also promoting responsible use of healthcare services, as individuals are directly involved in a portion of the payment process.

The other options describe different aspects of health insurance. The total cost of coverage per year relates to premiums, which is not specifically about copayments. The amount of money the insurer pays for a claim refers to the claim settlement process which is separate from the consumer's direct payment responsibilities. Lastly, deductibles are the amounts that must be paid out-of-pocket before the coverage kicks in, which is a different mechanism from copayment.